Samsung said it will “temporarily adjust operations” at its plants in the city and “take all necessary measures.”
Samsung’s two memory wafer fabrication plants in the city comprise 15% of the global NAND flash production capacity.
Other chip producers and users that could be affected by the news include Western Digital Corp (NASDAQ: WDC), Micron Technology I
nc (NASDAQ: MU), and Seagate Technology Holdings PLC (NASDAQ: STX).
While the scale and duration of any production loss are unknown, given disciplined NAND Flash vendor-held inventory levels, Wells Fargo analyst Aaron Rakers would view NAND production impacts as a positive for Western Digital and Micron.
According to Trendfocus, Samsung’s two Xi’an NAND Flash fabs totaled 245,000 wspm capacity during Q3, equaling 42% of Samsung’s total NAND Flash manufacturing capacity and 15% of the full NAND Flash industry capacity.
Benchmark analyst Mark Miller said he believes Samsung’s report is driving up Western Digital’s shares, noting that Samsung has two NAND plants in the city.
Shares of Western Digital competitors Seagate and Micron have been up to over 40% since mid-October. The improving memory chip prices, expectations for continued strength in cloud demand, and Micron’s expectations for a solid second half of 2022drove the momentum.
Miller reiterated a Buy and $92 price target on Western Digital.
Price Action: WDC shares traded higher by 6.03% at $66.62 on the last check Wednesday. MU shares traded higher by 3.58% at $96.26
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