NAND flash makers worried about possible delay of new iPhone

Josephine Lien, 19 July

Recent speculation that the launch of Apple's next-generation iPhone could be delayed is drawing concerns from NAND flash chipmakers over the strength of demand in the second half of 2012.

Apple devices usually consume a large portion of the overall NAND supply, and a similar scenario is likely to occur in the latter half of this year, according to sources at chipmakers. The period is also the traditional peak season for memory used in smartphones and other popular consumer technology products, but the new iPhone's availability will play a role in determining the overall demand outlook, said the sources.

In addition, prices for NAND flash memory at both spot and contract markets, which had slipped since early 2012 due mainly to weak demand, stopped falling recently, the sources observed. The stabilizing was as a result of suppliers' intentional output cuts rather than an actual rebound in demand, the sources said.

Chip suppliers generally hope that upcoming rollouts of new smartphones, tablet PCs and ultrabooks in the second half of 2012 will trigger the replenishment of NAND flash inventories and help boost chip prices.