Bad news for some, maybe good news for others? Apparently, the stock prices of the major memory manufacturers are starting to plummet… Hard. We saw it last time with Micron; this time, we’re learning that SK Hynix and Samsung aren’t faring much better. Apparently, the announcement of TurboQuant was a trigger. Add to that OpenAI’s U-turn regarding its memory purchases and the conflict in Iran, which may be exacerbating the trends!
Micron, Samsung, and SK Hynix in the red!
Some see this as the beginning of the AI bubble bursting, but the conflict in Iran could exacerbate tensions!
Yesterday, we learned that Google announced a new technology capable of significantly reducing memory requirements in the artificial intelligence sector. In layman’s terms, the technology uses compression at the KV cache level and vector search to reduce memory requirements by up to six times, while processing performance increases by up to eight times. That said, this remains highly theoretical since these results were obtained throughbenchmarking; we still need to confirm that these results hold up in real-world use.
In any case, it appears that OpenAI is in the midst of a cost-cutting process. We saw this with Sora, which exited the consumer sector on one hand. On the other hand, it seems the company has abandoned its adult chatbot. Now, we’re learning that the company no longer seems as eager to acquireDRAM inventory as initially planned. As a reminder, the plan was to purchase up to 40% of annual DRAM production.
However, OpenAI isn’t solely to blame for this price plunge, as the war in Iran rages on. As we know, conflicts are not viewed favorably by investors, and risk aversion drives selling, causing stock prices to plummet. Furthermore, with the Strait of Hormuz under pressure, oil prices are on the rise, as are prices for helium, which comes primarily from Qatar.
Sharp declines for Samsung, SK Hynix, and Micron!
As for stock market performance, since March 18, Samsung has lost nearly 20% of its market capitalization. SK Hynix is down more than 23% over the same period, while Micron is down 30%.
It remains to be seen whether this marks the beginning of the end for this sector or if it is simply a market correction linked to various announcements from Google and OpenAI. Nor should we forget the consequences of the war in Iran, which has the potential to exacerbate stock market volatility due to soaring energy costs.
