Toshiba NAND flash outage not expected to affect Apple products
Neil HughesThe power outage occurred at Toshiba's Fab 3 and Fab 4 in Yokkaichi, Japan, and it is believed that operations could resume on Friday. If the outage was severe enough, it could have a material impact on the wafers in process at the factory.
Toshiba management expects the outage to result in about a 20 percent reduction in NAND flash sales in January and February, based on the assumption that production does in fact resume on Friday.
Analyst Brian Marshall with Gleacher & Company said in a note to investors on Thursday that he doesn't believe the outage will have a material adverse affect on Apple. This despite the fact that Apple is one of the largest consumers of Toshiba memory, and prepaid a half-billion dollars for NAND in July 2009.
"We believe AAPL currently sources NAND flash from several vendors (e.g., Samsung, Toshiba and to a lesser extent Hynix and potentially IMFT [Intel Micron Flash Technologies] soon)," Marshall write.
He added that there do not appear to be any NAND flash shortages in the market today. He said most of Apple's supply constraints are related to display panels, as well as ramping up manufacturing to volume production.
Apple relies on NAND flash for a number of its products, including the iPhone, iPad and new MacBook Air. It is estimated that Apple's products use about 25 percent of all the flash produced in the world, and the iPhone maker has been accused of causing a shortage of stock on a number of occasions.
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3 Comments
Is it just me, or is it strange that shutting a plant down for 3 days could limit production by 20% over 2 months?
Is it just me, or is it strange that shutting a plant down for 3 days could limit production by 20% over 2 months?
It is a really long pipe, amongst other complicating factors
Is it just me, or is it strange that shutting a plant down for 3 days could limit production by 20% over 2 months?
Actually this is fairly normal. Shutting down a fab in an uncontrolled manner (which will have happened if they just lost power) is a nightmare. You end up having to setup a lot of the equipment from scratch, and then run pilot lots to really prove things out, so even if they get power back today, they will be re-calibrating everything for a couple of weeks before they run volume silicon.