Many market financial research institutions have recently forecast that the nearly stable memory market will start a price reduction storm in the second half of the year, due to market supply and demand and product guidance from manufacturers and other aspects. Goldman Sachs recently downgraded the investment rating of flash chip giant Magnesium Technologies from previous "neutral" to "sell", demonstrating an unoptimistic attitude towards the future flash chip market and boldly predicting a 30% drop in flash chip quotations in the next three quarters.

In this regard, industry insiders and other institutions also hold similar views, and give reasons to believe that the weak market demand is the main reason for the price decline of flash memory chips.

According to Taiwan's industry chain, the demand for flash chips for PC, server and video card terminals in the third quarter of this year is declining, and this trend may remain until the end of 2015.

Analysts from Morgan Stanley added that the guided consumption of manufacturer's products was not obvious.

Take Microsoft's Windows 10 operating system, which will be officially launched, as an example, the requirement of memory capacity specification in its announced computer hardware configuration has not been substantially improved, which reduces the desire of users to upgrade and hits the demand of memory products.

At the same time, the huge sales of the iPhone will also usher in new products in the second half of this year. Previous rumors that it will upgrade to 2GB memory, although this will increase the demand for flash chips of the corresponding specifications, but it will also suppress the shipment of other smartphones, offset by the two, the overall market demand for flash chips will not increase much.

In addition, for China, which is a big consumer and manufacturer of electronic products, the relationship between supply and demand of flash memory chips is still overstocking. It is reported that a large Chinese manufacturer cancelled a large number of chip orders a few weeks ago.