US-based memory chipmaker Micron initiates job cuts in China, withdrawing from the mobile NAND market due to retreat.
Micron Technology Exits Mobile NAND Market and Cuts Jobs in China
Micron Technology, a leading memory chip manufacturer based in Boise, Idaho, has announced that it is exiting the mobile NAND market and cutting over 300 jobs in mainland China. The job cuts, which primarily affect research and development, testing, and support roles within Micron's embedded teams in Shanghai, Shenzhen, and Xi'an, are not directly related to the mobile NAND market exit.
The company's decision to exit the mobile NAND market is driven by the segment's underperformance and changing market dynamics. The mobile NAND market has been facing weakness due to slowing global smartphone sales, escalating US-China trade tensions, and a shrinking share of Micron's sales in China.
In addition, the volatile semiconductor industry environment has prompted Micron to refocus on other NAND products with better growth prospects, such as SSDs and automotive applications. The company will halt global development of mobile NAND products, including the termination of the Universal Flash Storage 5 (UFS5) development program.
Despite these changes, Micron will continue developing and supporting other NAND products. The company's decision to exit the mobile NAND market is not a response to specific economic or political events in mainland China, but rather a strategic move to respond to the broader market challenges.
The lay-offs were accompanied by generous compensation packages for voluntary departures, a common practice among foreign tech companies downsizing in China. However, the exact number of jobs cut by Micron Technology in mainland China has not been disclosed.
It's important to note that the global memory chip market fluctuations and US-China tensions are separate issues from the lay-offs at Micron Technology in mainland China. The lay-offs at Micron Technology's smartphone-related facilities in mainland China are not directly related to the exit from the mobile NAND market.
This news comes as other foreign technology companies have also downsized operations in China over the past few years, reflecting the increasingly complex business environment in the country. Micron Technology's employee, who reported this information, was not authorized to speak to the media.
References:
- Reuters
- Bloomberg
- TechCrunch
- CNBC
- The Information
- Micron Technology's decision to exit the mobile NAND market is based on the segment's underperformance and changing market dynamics, as well as a shift towards more promising NAND products like SSDs and automotive applications.
- Despite exiting the mobile NAND market, Micron Technology will continue developing and supporting other NAND products.
