Micron was among the first companies to start mass production and shipments of 3D QLC NAND, so it is not surprising that at present it is among the leading suppliers of such flash memory as well as products on its base. According to the company’s management, bit shipments of 3D QLC for SSDs almost doubled quarter-over-quarter.

Micron uses its 3D QLC NAND for a number of products, including NVMe and SATA SSDs for clients and servers as well as microSD memory cards. In addition, Micron sells 3D QLC to other suppliers of SSDs. Since per-GB pricing of 3D QLC flash memory is very competitive against 3D MLC and 3D TLC, drives featuring this type of NAND are priced very reasonably, which makes them popular among end users. Considering this, it is not surprising that shipments of Micron’s 3D QLC memory for SSDs have increased 75% quarter-over-quarter.

“QLC SSD bit shipments increased approximately 75% sequentially, driven by growth of our consumer NVMe SSDs,” said Sanjay Mehrotra, CEO of Micron.

According to estimates by SK Hynix, TLC NAND accounts for 85% of the NAND flash market today, so it will take 3D QLC quite some time to challenge the proven type of memory in terms of bit shipments.

Micron admits that supply of 3D NAND continues to exceed demand, which negatively affects pricing from a supplier perspective. Transition to 96-layer 3D NAND as well as to 3D QLC memory will inevitably increase the  supply of flash in terms of total bit capacity. To that end, Micron plans to further adjust production of NAND in the coming quarter, but it remains to be seen whether this will help as the company will be cutting production (among other things) of its prior-generation NAND devices.

“Since our last earnings call, we have taken actions to further adjust wafer starts from the previously announced 5% reduction to now approximately 10%, which will result in lower supply growth in the second half of the calendar year,” said Mr. Mehrotra.

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Source: Micron

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  • azfacea - Friday, June 28, 2019 - link

    they can't really cut production. they want to talk about it, but can't really do it. losing volume means the losses will be even bigger on the remaining volume as they can't amortize R&D and risk losing market share to competitors. Also i don't believe they are losing money on 3d nand at the moment. they are making less for sure, but i dont think they are losing money. Reply
  • Skeptical123 - Friday, June 28, 2019 - link

    SK Hynix goal is to maximize profit, not volume. Simple selling their product above a loss is not their goal. Also since there are relatively few mass NAND suppliers and the market segment has some of the highest barrier costs to entry in the world it is safe to say this is a solid move by the CEO. Reply
  • emn13 - Saturday, June 29, 2019 - link

    Fixed costs in something like this are huge. Maximizing profit is roughly equivalent to maximizing revenue. Short term: most of the costs are already payed; so no point in not selling as much as possible. Medium term: reducing production means ceding ground to competitiors, which means less revenue to reinvest in future tech, and plain old buyers momentum working against you.

    Maybe in the longest terms it makes sense to reduce investment in new fabs a bit, but even that's risky because of competition and because newer fabs are likely to be better in various ways.

    However, in probably related news, WD/Toshiba have involuntarily reduced production, so if there's ever a time to save whatever money they can at the cost of reduced production, it's now. And as you say, they may be approaching anticompetitive size; and if they're (implicitly or explicitly) colluding with their competition it's another story.
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  • DyneCorp - Saturday, June 29, 2019 - link

    You mean paid? Not payed? Reply
  • zodiacfml - Saturday, June 29, 2019 - link

    quite agree. they simply cut prices of large capacity drives. I've seen an Intel 1tb nvme drive for $88 or other drives are less than $100. 1TB drive today is cheaper than the SATA 256GB m.2 drive I bought at the end of 2017, not even two years. Reply
  • Yojimbo - Saturday, June 29, 2019 - link

    The prices will continue to go down because cost per bit is going down. What they are trying to avoid is a crash in prices from oversupply, putting them in financial distress and causing a sudden contraction in production and capital expenditures among the NAND suppliers. That would cause a ripple effect and a possible price spike later, at which time China will probably accuse the manufacturers of collusion and try to extort them. Also, NAND companies probably need to build up a solid financial base because China will probably eventually start to heavily subsidize their NAND production to force foreign competitors out of the business. They do it with various industries. They did it with solar cell production, and now that they have taken over the solar panel business they are dialing back those subsidies and can put the resources elsewhere. Reply
  • Yojimbo - Saturday, June 29, 2019 - link

    By the way, cost per bit means the cost of production, not what they sell it for. Reply
  • DyneCorp - Saturday, June 29, 2019 - link

    Interesting; thanks for the info. Reply
  • Manch - Tuesday, July 02, 2019 - link

    Yup, they have done this to western Europe's steel & heavy manufacturing industries as well. Save for the former Eastern Block countries, which still have some. Reply
  • Yojimbo - Saturday, June 29, 2019 - link

    I don't think they claimed that they were losing money on NAND, did they? But if supply continues to outstrip demand then they will lose money, even if they sell more NAND. They aren't cutting production, by the way. Production is growing. They are cutting wafer starts. By using more advanced manufacturing techniques, such as adding more layers to 3D NAND or by moving to QLC NAND, bit growth grows. So if such technology transitions result in a bit growth that exceeds demand bit growth their profits will go down. So they can and will cut wafer starts. Reply

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