Samsung Electronics Co. Ltd. and Micron Technology Inc. said on Wednesday that operations at their memory chip production facilities in Xi’an, China, have been affected by the COVID-19 lockdown in the city.

Samsung is the world’s leading maker of NAND flash chips, with an estimated 36.1% market share as of last March. The company’s two production lines in Xi’an reportedly account for more than 40% of all the NAND flash that it manufactures. As a result, the production lines are believed to account for more than 10% of the world’s total NAND flash supply. 

In a Wednesday statement, Samsung said that “due to the ongoing COVID-19 situation, we have decided to temporarily adjust operations at our manufacturing facilities in Xi’an, China.” According to Reuters, the facilities are operating normally and the supply of raw materials used in NAND flash production appears sufficient. However, it’s reportedly possible that a “slight drop” in output could occur further down the line.

Micron is another major player in the memory  chip market, offering both flash and DRAM products. The company’s manufacturing facility in Xi’an produces DRAM memory. Micron said on Wednesday that “the city’s closure has reduced Micron’s team member and contractor workforce at our Xi’an site, resulting in some impact to output levels of our DRAM assembly and test operations there.”

“We are tapping our global supply chain, including our subcontractor partners, to help service our customers for these DRAM products,” the company added. “We project that these efforts will allow us to meet most of our customer demand, however there may be some near-term delays as we activate our network.”

Micron also said that it will work with customers, suppliers and logistics partners to minimize any impact to delivery schedules.

Micron ranked as the world’s third-largest DRAM manufacturer as of last March with a 23.5% share of the market. Samsung led the DRAM segment with a 41.7% share. The companies are also competitors in the NAND flash market. 

The circuits of a NAND chip are stacked atop one another in layers to increase memory density. Increasing the number of layers increases the amount of data that a chip can store. Samsung and Micron have been developing increasingly sophisticated circuit designs to gain an edge in this area. 

In July, Micron started shipping NAND flash modules described as the world’s first to feature 176 layers of circuits. The company has stated that the modules can provide up to 75% faster sequential write and random read performance than its previous-generation devices, which featured 96 layers. Samsung, meanwhile, is reportedly developing 200-layer NAND technology. 

Photo: Samsung