Did The Chip Market Flip Around In One Week?

from the flip-chip dept

Just a week ago, there were reports that big PC makers were likely to benefit from low component costs, at least in the short term. But even something as simple as current or recent prices of chips can be difficult for analysts to get a handle on. Now a Wall Street analyst is calling for an upswing in component prices, particularly flash memory chips and LCD panels. Meanwhile, Samsung has also announced that it’s seeing a strong pricing environment for its NAND and DRAM chips. While these conflicting reports demonstrate how hard it is to get a handle on the market, the deeper point is that any trend is likely to reverse itself rapidly, as no party will enjoy strong pricing or cheap pricing very long without things balancing out.

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Companies: samsung

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Comments on “Did The Chip Market Flip Around In One Week?”

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Martin Edic (profile) says:

Chip Price Fluctuation

One major factor is how dependent these companies are on debt to manage their business. Because it is cyclical, they do depend on debt in many cases to give them the ability to shift to emerging technologies rapidly. And as we’ve seen in the markets, the ability to easily borrow large sums has practically vanished overnight.
Paradoxically this is not the case for companies like Apple or Cisco who don’t actually build their products from scratch- they are primarily design and marketing companies who sub out manufacture to others. That’s why they sit on piles of cash and are not dependent on borrowing.

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