Kioxia head Hiro Ota made an unexpected statement about the current market: He asked sales departments not to seek significant price increases when negotiating with data centers. According to him, even the largest cloud companies have limited budgets.
This decision is particularly noteworthy given the sharp rise in NAND costs. Kioxia raised prices on its products by about 70% in the quarter ended in June. However, Ota now believes memory prices have risen enough that further increases in costs could start to hurt the overall market. The head of the company only took over in April but has already managed to develop a more cautious pricing policy.
Although Apple was not mentioned directly, the American company may also be able to take advantage of Kioxia’s change of stance. Apple is the manufacturer’s largest customer, accounting for about 20% of its revenue. For the company, that’s especially important against the backdrop of rising memory costs: Apple previously warned investors that parts costs would be higher in the September quarter than three months ago.
Against this backdrop, Kioxia’s status could be a small respite for electronics makers under pressure from rising memory chip prices. However, at the moment we are specifically talking about a reluctance to achieve new significant increases, rather than a reduction in already established prices.