Micron Technology is reducing DRAM and NAND wafer starts by approximately 20% versus fiscal fourth-quarter 2022 and is also working toward additional capex cuts. The moves are to respond to market conditions, according to the memory chip vendor.
The planned wafer starts reductions will be made across all technology nodes where Micron has meaningful output, the company indicated.
"The market outlook for calendar 2023 has weakened," said the chip vendor in a statement. "In order to significantly improve total inventory in the supply chain, Micron believes that in calendar 2023, year-on-year DRAM bit supply will need to shrink and NAND bit supply growth will need to be significantly lower than previous estimates."
Micron now expects its bit supply growth to be negative for DRAM and in the single-digit percentage range for NAND in calendar 2023.
"Micron is taking bold and aggressive steps to reduce bit supply growth to limit the size of our inventory," said company president and CEO Sanjay Mehrotra. "We will continue to monitor industry conditions and make further adjustments as needed."
Despite the near-term cyclical challenges, Mehrotra continued, "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."
Micron is scheduled to hold its fiscal first quarter earnings conference call on December 21.
Micron disclosed in late September its decision to slash spending on new chipmaking gear by 50% to counter what it called an "unprecedented" market downturn. Its capex outlook for fiscal 2023 is set at around US$8 billion, down more than 30% from a year earlier. Micron also gave its dim business outlook for the first quarter of fiscal 2023.