Macronix International Co (旺宏), the world’s biggest NOR flash memory supplier, yesterday said it would spend NT$22 billion (US$699.1 million) on capacity expansion this year to increase its production of mid-to-low-density memory chips as the world’s major memorychip suppliers are phasing out the market.
The company said its planned capital expenditures are about 11 times higher than the NT$1.8 billion it spent on new facilities and equipment last year.
A majority of this year’s outlay would be allocated to step up capacity of multi-level cell (MLC) NAND flash memory chips, which are used in embedded multimedia cards (eMMC), a managed memory unit integrating NAND and a controller.
Photo courtesy of Macronix International Co
The fresh capital injection would add about 10,000 wafers to the capacity of the company’s 12-inch factory, which is 20,000 wafers a month, by the end of this year, a 50 percent increase, Macronix president Lu Chih-yuan (盧志遠) told an online investors’ conference.
“Samsung announced its plans to stop producing and supplying eMMC [NAND flash memory chips]. The impact is huge. That has led to severe shortages in the market,” Lu said. “Macronix is the only company capable of producing MLCs used in eMMC, except the world’s four-biggest memorychip players: Samsung, Hynix, Micron and Kioxia.”
It would not be easy to solve the supply constraints soon, given the void left by those large-scale memorychip makers who are redirecting resources and capacity toward pricey high-bandwidth-memory chips used in artificial intelligence (AI) devices, Lu said.
It would take two to three years to build a new factory, not to mention a tight supply of facility-related equipment such as clean rooms, and water and chemical piping systems, he said.
To fully support the capacity expansion, Macronix plans to delay its development of 3D NOR flash memory chips for about two years, he said.
In addition to NAND flash memory chips, the company also saw strong demand for 2D NOR flash memory chips used in AI servers and high-performance-computing devices, he said.
Macronix expects its factory utilization rate to rise to about 100 percent this year to satisfy customer demand, Lu said.
The chipmaker expects its gross margin this year to return to its long-term “high-level” target, he said, adding that it has set a long-term goal to bring its gross margin back to 40 percent.
Macronix said quarterly losses narrowed significantly to NT$294 million during the fourth quarter of last year, compared with a loss of NT$862 million in the third quarter and a loss of NT$1.55 billion in the last quarter of 2024.
Earnings per share improved to minus-NT$0.16 last quarter from minus-NT$0.47 in the previous quarter and minus-NT$0.84 a year earlier.
Last year, Macronix saw losses widen to NT$3.31 billion from NT$3.21 billion.
Earnings per share dropped to minus-NT$1.77 from minus-NT$1.73, it said.
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