The iPhone 16 series officially launches globally today, and according to MacMagazine, Apple has expanded production beyond China and India, with Foxconn now assembling iPhone 16 units in Brazil. This marks the first time a new Apple model is being produced in South America during its initial launch phase, which helps the company overcome Brazil’s steep import tariffs, boost sales, and mitigate potential supply chain disruptions caused by geopolitical tensions.

Brazilian regulatory filings confirm that Foxconn’s factory in Jundiaí, São Paulo, is mass-producing the iPhone 16.

MacMagazine reports that while Foxconn’s Brazilian plant has previously assembled iPhones, it mainly focused on older models. This time, for the first time, the factory is part of the assembly lineup for the new iPhone 16, though it’s only producing the basic model and not the higher-end Pro variants.

Supply chain sources cited by Economy Daily News indicate that previous models like the iPhone 14 and iPhone 15 were also assembled in Brazil to avoid the country’s high import duties. However, these units were initially produced in China before being assembled in Brazil later in the product cycle. The iPhone 16, on the other hand, is being produced in Brazil much earlier, reflecting Apple’s ongoing efforts to diversify its supply chain and reduce its dependency on China.

Foxconn’s Brazilian facility is currently assembling only the base iPhone 16, not the iPhone 16 Pro or Pro Max models. This is largely due to the high cost of iPhones in South America, where entry-level models tend to be more popular.

In contrast, this year marks the first time Apple has launched India-made iPhone 16 Pro and iPhone 16 Pro Max models, a major milestone for both Apple and India’s manufacturing industry.

(Photo credit: Apple)

By announcing a two-year delay in its plan to build chip factories worth €30 billion (USD 33 billion) in Magdeburg, Intel seems to find a way to temporarily alleviate its financial burden. However, a report by German media outlet DW News warns that the chances of the US chipmaker eventually moving forward with its Magdeburg plans are “no higher than 50%,” indicating the withdrawal may deal a heavy blow to Germany’s economic outlook.

Citing Alexander Schiersch from the Institute for Economic Research (DIW) in Berlin, the report notes that Intel’s ambitious plans have “fallen short.” Three key challenges for Intel has been highlighted: attracting more customers for its chips, improving its AI strategy, and ensuring that cost-cutting measures are effective.

Given the circumstances, Schiersch estimates the likelihood of Intel fully executing its Magdeburg plans at “no more than 50%,” the report suggests.

The report also states that Intel’s move underscores the failure of Germany’s three-party coalition government to drive new investments, with debates on the allocation of the nearly €10 billion set aside for subsidies reignited.

According to DW News, following Intel’s announcement, Finance Minister Christian Lindner proposed redirecting the unspent funds to address a significant shortfall in the German budget. However, the Greens, part of the coalition government, opposed this idea, advocating instead for the funds to be used for climate initiatives. Chancellor Olaf Scholz of the Social Democrats has yet to take a definitive stance.

According to Intel, the German mega-fab is expected to create 3,000 high-tech jobs. During the construction phase, around 7,000 workers will also be employed in the construction industry. In addition, tens of thousands of additional jobs are expected to be created by suppliers and partners.

The German government has pledged €9.9 billion in state aid in terms of the project, as the investment is seen crucial in reducing Germany’s reliance on Asian semiconductors, particularly for its key automotive industry.

However, Volkswagen, one of the largest automaker in Europe for decades, has also been struggling, warning about potential job cuts and production line closures in Germany for the first time in its 87-year history, which may also prompt Intel’s decision. The weak market demand, particularly for its electric vehicles (EVs), is said to be the main reason for this move.

Read more

• [News] Intel Reportedly Sought Commerce Secretary Raimondo’s Help over U.S. Reliance on TSMC
• [News] Intel to Turn Foundry Unit into Subsidiary, with Projects in Germany and Poland Delayed for 2 Years

(Photo credit: Intel)

In 2024, the storage market is experiencing dynamic changes, with many positive developments, including rising contract prices, significant revenue growth for manufacturers, and multiple breakthroughs in technology. Amid this, major storage companies are gearing up for new challenges, especially as the NAND flash memory sector faces an impending shift.

How Far Have Major Companies Progressed with NAND Flash Technology?

This year, major storage manufacturers like Samsung, Micron, and SK Hynix have all made notable advancements in NAND flash technology.

In terms of NAND cell technology, Samsung has become the first in the industry to mass-produce its 9th generation V-NAND with QLC technology. On September 12, Samsung announced it had begun mass production of its 1Tb QLC (Quad-Level Cell) 9th generation vertical NAND (V-NAND), incorporating several groundbreaking technologies.

From a technological innovation perspective, Samsung’s 9th generation QLC V-NAND employs its unique channel hole etching technology to achieve the industry’s highest stack height with a dual-stack structure. Leveraging the expertise of TLC 9th generation V-NAND, the cell area and peripheral circuits are optimized, resulting in an 86% higher bit density than the previous generation.

Compared to earlier versions, the design of Samsung’s 9th generation QLC V-NAND improves data retention performance by about 20%, enhancing product reliability. Writing performance has doubled, and data input/output speeds have increased by 60%. Additionally, its low-power design reduces power consumption for both read and write operations by approximately 30% and 50%, respectively. This is achieved by sensing only the necessary bit lines (BL) to minimize power usage.

In terms of applications, Samsung plans to expand the use of the 9th generation QLC V-NAND from branded consumer products to mobile universal flash storage (UFS), PC, and server SSDs to meet the demands of customers, including cloud service providers.

Sung Hoi Hur, Executive Vice President and Head of Flash Product and Technology at Samsung Electronics, stated that as the enterprise SSD market grows rapidly and demand for AI applications increases, the company will continue to strengthen our leadership in the high-capacity, high-performance NAND flash market through 9th-generation QLC and TLC V-NAND.

However, at present, the mainstream products in the market are still TLC NAND flash memory particles. On August 6, SK Hynix’s Solidigm launched PCIe 5.0 data center SSDs, the D7-PS1010/1030 series, based on SK Hynix’s 176-layer 3D TLC NAND.

On September 11, SK Hynix announced the development of its high-performance SSD “PEB110 E1.S” for data centers, available in 2TB, 4TB, and 8TB versions. Currently undergoing validation with global data center customers, SK Hynix plans to begin mass production in the second quarter of next year.

On the other hand, Micron announced in late July that its SSD products featuring 9th generation (G9) TLC NAND technology had entered mass production, targeting personal devices, edge servers, enterprises, and cloud data centers. Micron’s G9 NAND achieves a data transfer rate 50% faster than current NAND technology used in SSDs. Its per-chip write and read bandwidths are 99% and 88% higher, respectively, than other NAND solutions. The Micron 2650 NVMe SSD, based on G9 NAND, achieves near-PCIe 4.0 performance levels, with a sequential read speed of up to 7,000 MB/s.

Micron also launched its new data center SSD, the 9550 NVMe SSD, featuring 232-layer 3D TLC NAND. It supports various AI workloads, offering a sequential read speed of 14.0 GB/s and a write speed of 10.0 GB/s—67% higher than competitive SSDs. The 9550 SSD’s random read speed reaches 3,300K IOPS, 35% higher than competitors, with random write speeds 33% higher.

The future of QLC SSDs is promising

Industry information indicates that NAND Flash, the core medium for data storage, is vital for SSD performance. Current SSDs use both TLC (Triple-Level Cell) and QLC flash.

In the AI era, there is a growing demand for storage, with SSDs playing a critical role. According to TrendForce, SSDs not only store model parameters during AI model training but also create checkpoints to save progress, making them crucial for high-speed data transfer and durability. As a result, customers primarily opt for 4TB/8TB TLC SSDs to meet the rigorous demands of AI training processes.

QLC SSDs, however, are gaining attention due to their higher storage density, which optimizes server space and reduces energy consumption. They can help large-scale data centers lower their total cost of ownership (TCO) while still meeting high-performance storage needs. Industry experts predict that as more data is generated in the form of videos and images, requiring larger storage capacities, TLC/QLC SSDs of 16TB or more will become the primary products for AI inference applications.

According to TrendForce, AI-related SSD procurement is expected to exceed 45 exabytes (EB) in 2024, with SSD demand in AI servers projected to grow by over 60% annually in the coming years. The share of AI SSDs within the NAND Flash market could rise from 5% in 2024 to 9% in 2025.

The Changing Landscape of the NAND Flash Market

On September 9, TrendForce’s latest research  indicates that in the second quarter of 2024, Samsung maintained its global leadership in the NAND Flash market with a 36.9% market share, up 0.2% from the previous quarter. SK Group followed with a 22.1% share, down 0.1%. Other key players include Kioxia (13.8%), Micron (11.8%), and Western Digital (10.5%).

In terms of revenue, Samsung, SK Group, Kioxia, Micron, and Western Digital all experienced quarter-on-quarter growth in NAND Flash revenues during the second quarter. Overall, NAND Flash revenue increased by 14% in the second quarter.

TrendForce indicates that as the inventory adjustments for server endpoints near completion and AI drives demand for high-capacity storage products, NAND Flash prices continued to rise in Q2 2024. However, due to high inventory levels at PC and smartphone manufacturers, NAND Flash bit shipments decreased by 1% quarter-over-quarter. Despite this, the average selling price increased by 15%, with total revenue reaching USD 16.796 billion, a 14.2% increase from the previous quarter.

Looking ahead to Q3, TrendForce expects that all NAND Flash suppliers have returned to profitability as of Q2 and plan to expand production capacity in Q3 to meet strong demand from AI and servers. However, due to weak market performance in the PC and smartphone sectors in the first half of the year, it is challenging to boost NAND Flash shipments. It is estimated that the average selling price of NAND Flash products will increase by 5% to 10% in Q3, while bit shipments may decrease by at least 5% due to a lack of peak season demand. Industry revenue is expected to remain roughly the same as the previous quarter.

(Photo credit: Samsung)

According to a recent report from BusinessKorea, Morgan Stanley published its “Winter Looms” analysis, following last month’s “Prepare for the Peak,” which warned of an AI bubble. The report continues to take a bearish view on Korean memory chipmakers, citing weak demand for general DRAM and an oversupply of AI-specific high bandwidth memory (HBM).

Morgan Stanley projects that in 2024, global HBM supply will hit 250 billion gigabits (Gb), far exceeding demand, estimated at 150 billion Gb—a surplus of 66.7%. The firm also points to Samsung Electronics’ aggressive expansion into the HBM market as a major factor driving this potential oversupply.

BusinessKorea cited industry insiders who argue that Morgan Stanley’s outlook is excessively pessimistic. They note that the HBM market is driven by customized, client-approved products, making oversupply less likely. Both SK Hynix and Samsung Electronics have publicly stated that HBM supply is fully booked through 2025.

Critics further contend that Morgan Stanley has underestimated the scale of AI investment by major tech firms, which is the main driver of HBM demand. While the report projects that AI investment growth from 10 major tech companies will drop sharply from 52% this year to 8% next year, Bloomberg forecasts a 33.7% rise this year and a 13.4% increase in 2025 across 13 leading tech firms.

Morgan Stanley also predicts that general DRAM will peak in Q4 2024 and begin a multi-year decline through 2026, citing weak demand for semiconductor-reliant IT products. The global PC and smartphone markets have indeed been sluggish, with reports indicating that pre-orders for Apple’s iPhone 16 series were down 13% compared to its predecessor. However, the same report noted that Samsung Electronics and SK Hynix have both stated that demand for memory in smartphones and PCs remains stable.

TrendForce Senior Vice President Avril Wu noted that while DRAM prices have shown signs of weakness over the past two quarters, the overall average selling price is expected to rise by 2025. Wu added that as HBM continues to take up more conventional DRAM production capacity, pricing across different products may vary, but the increasing penetration of HBM should help stabilize the DRAM market, leaving the firm less pessimistic about next year’s outlook.

(Photo credit: Samsung)

As the U.S. and its allies continue to impose technology restrictions on China’s semiconductor sector, Beijing has accelerated its efforts to develop homegrown alternatives. Chinese firms are aggressively pursuing advanced AI chip development, aiming to rival Nvidia, the global leader in AI semiconductors. A recent CNBC report highlighted seven Chinese companies to watch, including Huawei and Alibaba.

Huawei, the first of Nvidia’s Chinese challengers, is gaining attention with its new Ascend 910C AI chip, which is expected to compete with Nvidia’s H100.

Alibaba follows closely behind. After acquiring C-Sky Microsystems in 2018, the company integrated it with its in-house chip division to form T-Head. In 2019, T-Head launched its first AI inference chip, the Hanguang 800, which has since been deployed at scale in Alibaba’s hyperscale data centers.

Baidu ranks third with its self-developed AI chip, Kunlun. The chip has matured significantly, and in June, Baidu received a strategic investment from Beijing’s AI Industry Investment Fund, marking the first time a state-owned entity has invested in an AI chip firm, boosting Baidu’s growth prospects.

Biren Technology, in fourth, focuses on GPUs like Nvidia, with a software platform to build applications on top of its hardware. Biren’s Bili series of chips are designed for AI training in data centers. Last week, Biren registered for IPO guidance with the Shanghai Securities Regulatory Bureau, marking the start of its public listing journey.

Cambricon Technologies, ranked fifth, designs a wide range of semiconductors, from chips that train AI models to those running AI applications on devices. Known as China’s first AI chip stock, Cambricon has faced setbacks since being blacklisted by the U.S. in late 2022, with reports of large-scale layoffs last year.

Moore Threads, founded in 2020, is developing GPUs for training large AI models. Its data center product, MTT KUAE, integrates GPUs and is aimed at competing with Nvidia.

Enflame Technology, the seventh company on the list, positions itself as a domestic alternative to Nvidia, focusing on AI training chips for data centers. Enflame began IPO guidance on August 26, and is expected to list on the STAR Market alongside Biren either by the end of this year or early next year.

(Photo credit: Huawei)