Micron to scale back production of memory chips in 2023

Yahoo Finance Live anchors discuss Micron cutting back on the production of memory chips in 2023 following turmoil within the tech space.

影片文字轉錄稿

[AUDIO LOGO]

JULIE HYMAN: All right, let's take a look at shares of Micron here this morning because we have some breaking headlines here that the company is cutting back production. It's cutting DRAM and NAND wafer starts by about 20% versus the fourth quarter of last year because of market conditions.

This, of course, is just the latest semiconductor company that has come out and either warned on profits or said that it's gonna be cutting back on production here. We have seen a lot of turmoil within this space. And Micron shares, you guys, are down 3 and 1/2% on this.

I mean, it's very interesting, though, because we are not seeing them sort of across the board-- like for example, you look at a Taiwan Semiconductor, which has been rallying for a few days now ever since we learned Berkshire Hathaway had added it to its holdings. But then a lot of the semiconductor industry is challenged right now.

BRAD SMITH: Yeah, we have a statement from the CEO Sanjay Mehrotra, who said that Micron is taking bold and aggressive steps to reduce bit supply growth to limit the size of our inventory. They're gonna continue to monitor industry conditions and make further adjustments as needed.

Also, going on to say, despite the near-term cyclical challenges, we remain confident in the secular demand drivers for our markets. And in the long term, expect memory and storage revenue growth to outpace that of the rest of the semiconductor industry.

BRIAN SOZZI: Yeah, and let's just keep in mind, too, now you have Micron coming out with this warning. Qualcomm, a couple of weeks ago, sounded an alarm bell in terms of demand. AMD with a very cautious outlook. Intel under pressure here. It's just not a good story right now in the semiconductor space.