Phison Stock Plummets Amid AI Server Memory Downgrade Reports

Phison, a leading NAND controller and storage solution provider, is experiencing a significant stock price drop despite reporting its strongest-ever second-quarter financial results. The company's stock fell over 9% on Friday, trading at NT$2,065 as of midday, with trading volume surging past the previous day's total.

This market reaction comes despite Phison announcing a consolidated revenue of NT$67.888 billion and an earnings per share (EPS) of NT$118.57 for the second quarter, both record highs. The company attributes this growth to the burgeoning AI sector, which is creating unprecedented demand for storage.

However, concerns are mounting over potential "downgrades" in AI server memory configurations. Phison CEO Pan Jian-cheng acknowledged that some systems are reducing DRAM allocation. This trend is reportedly driven by the tight supply and escalating prices of High Bandwidth Memory (HBM), essential for advanced AI processors like NVIDIA's new Rubin Ultra GPU. While DRAM configurations may be adjusted, Pan emphasized that the demand for NAND storage capacity in AI applications remains robust.

Phison views the current AI boom as a transformative phase for the global storage industry. The company is strategically shifting its focus from NAND controller technology to AI storage, AI memory, and AI infrastructure platforms, aiming to capitalize on new growth opportunities presented by the AI era through its "Phison 3.0" initiative.

“

We are indeed seeing some systems reduce their DRAM configuration, but Storage/SSD capacity has not shrunk. The demand for AI storage remains strong.