Samsung Power Glitch – Is It Important?
The answer really depends upon who you ask. An article in the Financial Express quoted Samsung as saying that it would have a minimal impact, and that full-scale operations should resume in a few days. The article also said that Samsung estimated that the wafer loss would be below 10,000 wafers.
Assuming that the entire loss consisted of Samsung’s most advanced 48-layer 256Gb 3D NAND a 10,000-wafer loss would be less than 1% of total industry gigabyte shipments.
Korea Times quoted an anonymous fund manager who said: “The one-time incident will cost Samsung up to 20 billion won, which is very minimal. It won’t make heavy impact on Samsung’s chip business and the entire industry.”
According to Korean news source Chosenilbo the outage was caused by: “A blast at a local power station” which the Korea Times article called a fire, and said that that: “Thousands of wafers were being processed at the time of the explosion.”
Barron’s quoted Susquehanna Financial’s analysis, which stated that the fab: “accounts for 28% of Samsung’s NAND wafer capacity and 10-12% of industry capacity.”
While The Memory Guy may disagree with the high percentage quoted by Susquehanna, this kind of event can be significant. After all, the Sumitomo Chemical explosion in 1992 was the spark that sent the DRAM market into a 3-year shortage.
Keep in mind, too, that Toshiba blamed a power failure of a mere 70 milliseconds duration for the loss of considerable output in December 2010. Although Samsung hasn’t stated the duration of its power failure, it was certainly orders of magnitude larger.
For now we can do nothing but wait and see what will happen. Objective Analysis has been cautioning our clients for several months to be prepared for a shortage stemming from a lack of 3D NAND capacity, and that shortage of 3D NAND capacity just got worse.