Samsung's Market Cap Takes $10 Billion Hit Amid Rumors of Apple DRAM Deal with Elpida

[MacRumors]

Digitimes' poor track record has been thrust into the spotlight in recent days, but that hasn't stopped one of the Taiwanese news site's reports from having a major effect on stock prices for Samsung and Hynix. The report from earlier this week claims that Apple has placed "huge" orders for DRAM chips with Elpida, soaking up half of the capacity at the firm's main plant in Hiroshima, Japan.

1 GB of Elpida DRAM in third-generation iPad (Source: iFixit)​

As noted by Reuters, the rumor has had a significant effect on fellow DRAM manufacturers Samsung and Hynix, with Samsung losing $10 billion in market value today in a 6% stock decline. The smaller Hynix was down nearly 9%

"It looks like Apple doesn't want to see Samsung and hynix dominate the chip market. Apple wants to maintain its bargaining power by keeping Elpida running," said Choi Do-yeon, an analyst at LIG Investment & Securities.

Elpida filed for bankruptcy in late February, and Micron has emerged as a likely acquirer for the company. The combined Micron-Elpida would be a strong competitor in the DRAM market, sparking concerns for others in the competitive industry.

DRAM, the volatile memory used to hold active applications and other data for use while a device is in operation, is a commodity in the consumer electronics market, with Apple routinely sourcing from multiple suppliers and shifting orders to achieve the best pricing.

Article Link: Samsung's Market Cap Takes $10 Billion Hit Amid Rumors of Apple DRAM Deal with Elpida

 

[aziatiklover]

Samsung: feelsbadman.jpg

 

[Feed Me]

Headline's a bit misleading, samsung hasn't taken a "$10 billion hit".

 

[WildCowboy]

Headline's a bit misleading, samsung hasn't taken a "$10 billion hit".

How is it misleading? It specifically says Samsung's market cap, which is indeed what dropped by $10 billion.

 

[Feed Me]

How is it misleading? It specifically says Samsung's market cap, which is indeed what dropped by $10 billion.

errr
Read it wrong.

 

[Peace]

If this is true and Apple goes with more vendors then samsung has something more to worry about.


Good for Apple and Elpida. Especially good for Micron if they do acquire Elpida.
In the old days I used to buy all my memory from Micron.

 

[Hakone]

Diversifying the supply chain; cheaper cost or just taking it to Samsung?

 

[Keebler]

any chance this could also be apple penalizing samsung in lieu of their ongoing legal battles?

 

[Digitalclips]

Does the take over my Micron go ahead then? Or does this mean the company will be OK after all with an order of this magnitude? If the take over is on then Micron must be smiling ... perhaps they knew in advance?

 

[Shanpdx]

Apple is the new Microsoft!!!

and next A6 chip build by Intel????

 

[Digitalclips]

any chance this could also be apple penalizing samsung in lieu of their ongoing legal battles?

You think?

 

[Plutonius]

any chance this could also be apple penalizing samsung in lieu of their ongoing legal battles?

Nope - This is just Apple wanting to keep multiple suppliers.

 

[basesloaded190]

Micron is up about 5% with the news. Good news for them either way.

 

[rjohnstone]

How is it misleading? It specifically says Samsung's market cap, which is indeed what dropped by $10 billion.

To call it a "hit" is sensationalism at its finest.
It's called business as usual.
Hell, Apple takes bigger hits every other day.

Where's the big story about how Apple's market cap has dropped nearly $80B in the last 4 weeks?
The reality... nobody cares. This is how the stock market operates.

 

[Peace]

To call it a "hit" is sensationalism at its finest.
It's called business as usual.
Hell, Apple takes bigger hits every other day.

Where's the big story about how Apple's market cap has dropped nearly $80B in the last 4 weeks?
The reality... nobody cares. This is how the stock market operates.

This story isn't really about the stock market. It has larger ramifications.

 

[One Bad Duck]

Sensationalism?

Where's the big story about how Apple's market cap has dropped nearly $80B in the last 4 weeks?
The reality... nobody cares. This is how the stock market operates.

I can see your point however the articles main focus is the fact all this has come from just a rumour from a site that isn't even that accurate with their "rumours". Seems like there's no such thing as crying Wolf on rumour sites.

 

[rjohnstone]

This story isn't really about the stock market. It has larger ramifications.

Explain the "larger ramifications".
Elpida lacks the production capacity of Samsung and their QA has not been the best in the past few years.
Part of why they are in bankruptcy.
Apple's order "may" save them, but only time will tell on that front.

Samsung will do just fine with or without Apple's memory purchases.

 

[bdkennedy1]

Or maybe Apple is telling Samsung to go ******* themselves for copying the iPhone and iPad.

 

[JohnDoe98]

I can see your point however the articles main focus is the fact all this has come from just a rumour from a site that isn't even that accurate with their "rumours". Seems like there's no such thing as crying Wolf on rumour sites.

And if the rumors turns out to be false, the market will correct itself, so again what's the point?

 

[MarkMS]

This story isn't really about the stock market. It has larger ramifications.

I see what you did there!

 

[Peace]

Explain the "larger ramifications".
Elpida lacks the production capacity of Samsung and their QA has not been the best in the past few years.
Part of why they are in bankruptcy.
Apple's order "may" save them, but only time will tell on that front.

Samsung will do just fine with or without Apple's memory purchases.

If samsung loses one of it's biggest customers it will affect their bottom line.

 

[marcusj0015]

Does the take over my Micron go ahead then? Or does this mean the company will be OK after all with an order of this magnitude? If the take over is on then Micron must be smiling ... perhaps they knew in advance?

I'm wondering the same thing lol

 

[dokujaryu]

Well, maybe this isn't just diversification. I mean, Apple couldn't keep up with initial demand of most of their products. Could it also be another way to speed up production?

 

[Skoopman]

Does the take over my Micron go ahead then? Or does this mean the company will be OK after all with an order of this magnitude? If the take over is on then Micron must be smiling ... perhaps they knew in advance?

Define "OK". Elpida isn't even listed on the Tokio Stock Exchange anymore... This rumor is really fishy.

 

[nikhsub1]

Ahh brings back memories of when MS saved Apple back in the 90's with a $150 million cash injection.