Operator Finance and Economics Kangzhao / Wen

On March 28th Micron, the largest U.S. memory chip giant, reported its biggest-ever quarterly loss because of inventory writedowns of more than $1.4 billion, which is clearly one of the consequences of U.S. chip policy. Why?

First of all, Meguiar is no ordinary chip company. Micron, Samsung and SK Hynix together hold 94 per cent of the market share of DRAM memory chips. In addition, Micron's total market share of $3.7 billion in automotive memory in 2021 is 55.0%, so Micron is one of the benchmark chip companies in the United States.

Second, Micron's loss has something to do with the decline in demand for memory chips in the market, mainly because sales of IT digital products such as mobile phones, tablets and notebooks have fallen sharply in recent years as a result of the epidemic, as well as the demand for memory chips.

On the other hand, it is also related to Huawei. According to data released by Micron, its annual revenue is about $20 billion, but Huawei accounts for 10%, or $2 billion, of that $20 billion.

The United States is constantly revising chip export rules, blocking Huawei's supply chain, and affecting companies that purchase and use American chips.

The United States is constantly revising chip export rules, blocking Huawei's supply chain, and affecting companies that purchase and use American chips.

It is obvious that the US ban on Huawei is killing the enemy and damaging half of itself.