Technology research group Gartner has forecasted that the memory chip market will remain flat in 2022 and is forecast to decline 16.2% in revenue in 2023 due to faltering demand, swollen inventories and customers pressing for considerably lower prices.

The research group forecasted that DRAM (dynamic random access memory) – used in personal computers (PCs), workstations and servers – revenue will decrease 2.6% to reach $90.5 billion in 2022 and will further decline 18% in 2023, to a total of $74.2 billion, noting that the worsening economic outlook continues to negatively impact smartphone, PC and consumer electronics products which are positioning the DRAM market for oversupply for the remainder of 2022 and the first three quarters of 2023.

The report also mentioned that revenue for NAND memory (a type of non-volatile storage technology that does not require power to retain data) is projected to increase by 4.4% to $68.8 billion in 2022, but it is on pace to decline 13.7% in 2023 to $59.4 billion.

The NAND fab outage which occurred in the first quarter of 2022, inflated prices, and masked the rapidly deteriorating demand environment, resulting in excess inventory in the third quarter of 2022 which is expected to carry into the first half of 2023.