Memory prices 2fold rise, increasing cost pressures on Samsung and LG
This year, 1quarterly memory prices doubled. This increased the raw material cost burden on Samsung Electronics and LG Electronics, directly affecting the manufacturing costs of home appliances and smartphones.
This year, 1quarterly memory prices rose sharply. Prices doubled. The industry calls this phenomenon a supercycle.
During this period, Samsung Electronics and LG Electronics faced a heavier raw material cost burden. Memory costs rose for appliances and smartphones made by the two companies. The increase in cost pressures is changing the cost structure of their products.
Product demand is slowing under the influence of the economic downturn. Demand for home appliances and smartphones has weakened. Slowing demand and rising costs are being observed at the same time.
Rising memory prices are a direct source of increases in production costs. The impact is greater for product categories in which memory is a major cost item for the electronics industry. Rising cost burdens are being reported across the industry.
Companies 1are tracking cost fluctuations in connection with quarterly results. Cases are emerging in which higher costs are reflected in quarterly results. The relevant indicators are compiled on a 1quarterly basis.
The current situation reflects the simultaneous influence of raw material prices and demand trends. Rising memory prices and slowing demand have changed the cost structures of electronics manufacturers. The industry is reviewing results based on related figures.