Stop purchasing! US chip giant's cybersecurity review failed! I did this before the results were announced

Tech 2023-05-22 01:47:47 Source: Network

After nearly two months, the review results of Meiguang Company showed that its products sold in China did not pass the network security review, and domestic operators of critical information infrastructure should stop purchasing Meiguang Company's products. For the latest review results, one of the A-share top storage giants and one of Meguiar's clients recently told a reporter from Securities Times

After nearly two months, the review results of Meiguang Company showed that its products sold in China did not pass the network security review, and domestic operators of critical information infrastructure should stop purchasing Meiguang Company's products. For the latest review results, one of the A-share top storage giants and one of Meguiar's clients recently told a reporter from Securities Times. e that it does not affect the company's operations.

It is worth noting that before the release of the review results, Micron announced its new China regional manager, and Micron increased its investment in the Japanese semiconductor industry.

Network security audit failed

This round of review of Meiguang Company dates back to March 31st. According to a document released by China NetEase, in order to ensure the security of the supply chain of critical information infrastructure, prevent potential product problems from causing network security risks, and maintain national security, in accordance with the National Security Law of the People's Republic of China and the Cybersecurity Law of the People's Republic of China, the Cybersecurity Review Office will conduct a cybersecurity review of Micron's products sold in China in accordance with the Cybersecurity Review Measures.

On May 21st, the review results showed that Meiguang Company's products have serious network security risks, posing significant security risks to China's key information infrastructure supply chain and affecting China's national security. Therefore, the Cybersecurity Review Office has made a conclusion in accordance with the law that it will not pass the cybersecurity review. According to laws and regulations such as the Cybersecurity Law, operators of critical information infrastructure in China should stop purchasing products from Meiguang Company.

Micron is a leader in the storage chip industry in the United States and one of the global storage chip giants. However, its revenue from China has continued to shrink, dropping from a peak of 57% in the past to about 11% in 2022. Meiguang has stated in a statement that the company is in communication with the National Internet Information Office of China regarding the investigation and is fully cooperating with the investigation.

It is worth noting that before the release of the review results, the General Manager of Meguiar China was "changed" and on May 11th, Betty Wu was appointed as the General Manager of Meguiar China and will continue to serve as the Vice President of DRAM Packaging and Testing Operations. In her job announcement, Wu Mingxia stated, "Meiguang's China business plays a crucial role in strengthening the company's global layout and DRAM technology leadership. I am looking forward to promoting Meiguang's future development blueprint in China and maintaining close cooperation with people from all walks of life, including central and local governments, as well as customers

A local supplier of storage in Shenzhen has revealed to reporters that Meiguang has already expressed interest in referring some domestic customers to its storage peers; The sales of landing products in the subsequent Meiguang survey will be affected. It is expected that Korean storage companies such as Samsung and SK Hynix will take over a portion of the Meiguang market in the future. Domestic storage companies are also expected to welcome opportunities, but there is still a gap in high-end products.

Regarding the potential impact of reordering, media reports indicate that in April, the United States requested South Korea to urge Korean chip manufacturers not to fill the market gap in China if China prohibits Micron from selling chips.

On the other hand, Micron has turned to investing in Japan, with the latest investment of approximately 3.6 billion US dollars for advanced process memory chip production. It will also introduce ASML's latest Extreme Ultraviolet (EUV) equipment, becoming the first company to bring EUV technology to Japan. Meiguang stated in a statement that this investment will "contribute to the next wave of end-to-end technological innovation, such as the rapidly emerging Generative Artificial Intelligence (AI) applications".

Impact of response review by listed companies

Among A-share listed companies, companies such as Jiangbolong and Baiwei Storage have disclosed international storage vendors such as Meiguang as their suppliers.

At present, Jiangbolong has established extensive cooperation both domestically and internationally in the upstream and downstream of the storage industry chain. According to the 2022 annual report, Jiangbolong has signed long-term contracts with major storage wafer manufacturers such as Samsung, Micron, and Western Data to ensure the stability of storage wafer supply and consolidate the company's supply advantage in the downstream market. The company also maintains good cooperation with domestic storage wafer manufacturers such as Wuhan Changjiang Storage and Hefei Changxin.

Dongxin Corporation also stated that it has not yet established any form of cooperation with Meiguang. It is reported that the company focuses on independent research and development, design, and sales of small and medium-sized storage chips as a storage chip design enterprise, committed to providing customers with high-quality storage products and solutions with independent intellectual property rights, stable supply chain system, and high reliability products.

Regarding the latest review results of Meiguang, one of the top A-share storage companies and one of Meiguang's clients recently told a reporter from E Company that it does not affect the company's operations.

Recovery expectations are once again high

Recently, the A-share storage sector has experienced a pullback in April and has become active again, further boosting the expected recovery of the semiconductor industry.

On May 19th, NetEase Changjiang Storage officially notified NAND of a price increase of around 3-5%. For this news, the market believes that the destocking of storage chips is coming to an end and entering a new round of business cycle, but it has not been officially confirmed. Storage giant Samsung released a "rare" production reduction in April, which is expected to alleviate the industry's oversupply situation. Recently, storage giants such as Micron and Samsung have issued "bottoming out" signals and will no longer lower prices to sell DRAM (dynamic random access memory) or NANDFlash (data based flash memory chip) products.

In addition, news of the integration of international storage giants has spread again, with media reports that international storage giants Japan Armor and American storage chip manufacturer Western Data are accelerating merger negotiations and finalizing the transaction structure. After the merger, the two sides may control one-third of the global NAND flash memory market.

In addition to industry consolidation expectations, SK Hynix has launched a fundraising plan with a scale of up to 500 billion Korean won (approximately $373 million). Company executives have stated that they are prepared for market improvement and expect an industry rebound as soon as the third quarter.

From the performance of A-share listed companies, it can be seen that in the traditional off-season of the electronics industry in the first quarter of this year, the profits of major storage companies did not improve, but de inventory began to make progress.

In a recent survey conducted by institutions, executives at Zhaoyi Innovation stated that significant results have been achieved in inventory reduction in the consumer industry, and urgent orders are often seen, indicating that customer demand is already emerging. Compared to the consumer sector, the reversal of supply and demand in the industrial sector will occur later, and its inventory reduction will take some time. At present, the company's current inventory situation is basically controllable.

Jiangbolong executives also stated in a survey that the company's inventory balance has slightly decreased from reaching a high value at the end of the third quarter of 2022 to the first quarter of 2023. To meet the needs of major customers and maintain a continuous and stable supply capacity, while meeting delivery requirements, the company also takes into account inventory liquidity and maintains a certain level of inventory; With the improvement of intelligence, the demand for storage capacity will continue to grow in the future, which is expected to drive the company's performance growth.

Editor in Chief: Zhang Qianyao

Checked by: Wang Jincheng

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