Intel and the Plunging Prices of Memory Chips
Chip-maker Intel Corp.’s CEO, Paul Otellini, vowed Wednesday to shore up the company’s defenses against steep drops in memory chip prices that forced it to lower its profit forecast for the current quarter.
Price erosion for NAND flash memory has been much steeper in the first quarter than Intel expected, Otellini said.
Otellini, speaking at an investor conference at the company’s Santa Clara headquarters, said the company plans to move aggressively this year into new markets to better insulate itself against plunging prices for a type of memory called NAND flash. One new market for NAND flash memory is solid-state computer drives, which store data on memory chips instead of spinning disks.
Despite the memory-market woes, Otellini says Intel’s core computing business is firing on all cylinders. Otellini said Intel is making rapid progress in shipping chips based on a new chip-making process.
The company is also re-evaluating how quickly it wants to increase its investment in NAND flash, Otellini said. Intel started making NAND flash in 2006 under a joint venture with Micron Technology Inc.
