Introduction: As the core of modern electronic technology, semiconductors are widely used in computers, communications, consumer electronics, automobiles, industrial control, medical equipment and other fields. As an important support for modern science and technology, the semiconductor industry plays a key role in economic development and social progress. With the continuous emergence of emerging technologies and the growth of market demand, the semiconductor industry is characterized by global competition. The United States, Japan, South Korea, China and other countries have strong strength and technical advantages in the semiconductor field, and the competition is fierce. The competition between global semiconductor companies is mainly reflected in technology research and development, product quality, cost control and market share competition.
With the intensification of market competition, the semiconductor industry is facing severe challenges and requires continuous innovation and cooperation to adapt to the latest news of market changes. A few days ago, the internationally renowned semiconductor giant announced the closure of its South Korean factory, which caused widespread attention from the outside world.
According to BusinessKorea, SK Hynix's U.S. subsidiary, Solidigm, has announced the closure of its Korean branch and the dismissal of all staff. It is reported that the reason why Solidigm closed the Korean factory was that due to the intensification of competition in the international market and the sharp decline in the industry situation, Solidigm had to choose to close the entire Korean branch. In this regard, the official representative of SK Hynix said that because Solidigm headquarters is implementing operational efficiency measures, although the factory has been closed, the future domestic product sales will be carried out through our headquarters or distributors.
Sources also revealed that long before shutting down the South Korean factory, Solidigm had carried out layoffs, and some personnel and positions were laid off. However, the market situation did not improve, and it was finally decided to lay off all the staff of the Korean branch. According to public information, Solidigm is still a big origin, he is a subsidiary of the well-known technology giant SK Hynix, the company's predecessor is Intel NAND flash memory business unit. Two years ago, SK Hynix acquired the Intel Flash Business Unit for $9 billion and established it as an independent subsidiary, which is responsible for all product development, production, sales and after-sales of SSDs.
So the question is, why did the Korean branch of Solidigm, which is not small, come to the point of closure? To answer this question, we need to focus on the revenue and profit of the company.
Affected by the fluctuation of demand in the international semiconductor market, the NAND price fell from an average of $4.81 in May 2022 to $3.82 in August 2023. That said, NAND prices remained depressed for an extended period of time. The acquired Solidigm is also not in a good position, with a sharp decline in the first six months of 2023, with a net loss of more than 2.2423 trillion won, and a loss of about 258.3 billion won in the first six months of 2022, and the size of Solidigm's losses increased eightfold in just one year. It is no exaggeration to say that the increase in Solidigm's losses means that the company has reached the point of survival.
Faced with such a huge scale of losses, Solidigm adopted the most common cost reduction and efficiency increase solution for enterprises - layoffs. It is understood that the latest layoff actually involves talents in the field of software and research and development, which can be said to have shaken the foundation of the enterprise. Despite this, Solidigm's situation has not been reversed, and the decline continues.
Semiconductor technology is changing rapidly, and the industry is highly competitive. If a factory's technological level cannot keep up with the development of the industry or loses competitiveness, and loses the basic market of the enterprise, it will face the risk of losing market share and continuous decline in profitability, which may eventually lead to the collapse of the entire line and even the collapse.