Solidigm Lays Off Employees Due to Industry Downturn
by Anton Shilov on October 25, 2023 9:15 PM EST
The solid state storage industry has been in a well-documented slide for the better part of the last year now. With storage product demand from both the client and datacenter businesses down well off of its highs in a notoriously cyclical business, we've already seen the big three memory manufacturers – SK hynix, Samsung, and Micron – significantly cut back on NAND production. And now the repercussions of this downturn are starting to spread to the SSD makers themselves, with Solidigm confirming that they have laid off employees due to the industry downturn.
Responding to an information request from AnandTech, Solidigm, Intel's former SSD business unit that is now controlled by SK hynix, confirmed that the company has recently engaged in layoffs. Terming it a 'modest' reduction in headcount, the company disclosed that it 'executed a modest workforce reduction' on Wednesday, but declined to provide further details.
"Due to the prolonged downturn in the semiconductor industry and its impact on market conditions, Solidigm has executed a workforce reduction," a statement by Solidigm reads. "The company is offering support and severance to colleagues who are departing. We are immensely grateful to our team members who have made meaningful contributions while at Solidigm. They will be greatly missed."
Solidigm is not disclosing their new headcount, though as of September, 2022, the company had more than 2,000 employees in 20 locations around the world. Earlier this year the company closed down its branch in South Korea and hired agencies to handle its sales in the country. It looks like the current announcement also relates to various business, management, marketing, and sales roles.
Solidigm inherited its personnel from Intel's NAND business unit, which the company agreed to sell to SK hynix in October, 2020. Solidigm closed the first stage of the deal in late 2021 and gained control over Intel's NAND and SSD businesses and NAND memory fab in Dalian, China. Under the terms of the agreement with SK hynix, Intel transferred some of its NAND business unit employees to Solidigm to operate as a SSD business.
At this point there has not been a public announcement of the layoffs by Solidigm/SK hynix, so it remains unclear what the full impact to the business will be. SK hynix has just released its Q3'2023 earnings report, where the company reported net losses of 2.185 trillion won (~1.6B USD), and will be holding its quarterly conference call this evening (the morning of the 26th in Korea), at which point we may find out more about the company's plans for their struggling subsidiary. Earlier reports to AnandTech had indicated more significant layoffs had taken place, though 'modest' leaves some room for interpretation.
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James5mith - Thursday, October 26, 2023 - link
Here's a shocking thought: If you produce new products that have more capacity, lower power draw, higher speeds, or some mix of all three for the same or a lower price, people will continue to buy and upgrade.If you keep jacking up prices to try and offset sliding sales, and stop innovating, then is it really a surprise that people will stop buying? If you think your products are good enough, so do the people who have already bought them. They have no impetus to purchase new products other than failure rates.
lemurbutton - Thursday, October 26, 2023 - link
Macro forces are often much stronger than micro forces. If the overall market is done, then there's not much they can do to stop bleeding sales.mode_13h - Thursday, October 26, 2023 - link
> If you produce new products that have more capacity, lower power draw, higher speeds,> or some mix of all three for the same or a lower price, people will continue to buy and upgrade.
Needs only increase at a certain rate. At some point, most people & businesses will have more than enough storage & bandwidth, at which point further purchasing will be fairly unresponsive to such incentives.
TheinsanegamerN - Monday, October 30, 2023 - link
640k will be enough for anyone!meacupla - Thursday, October 26, 2023 - link
This is just a normal boom-bust cycle that DRAM and NAND go through every 3 to 4 years.Samus - Friday, October 27, 2023 - link
meacupla is exactly right. Since the 90's, this industry has been embarrassingly cyclical. It has claimed numerous companies on the process. Japan has been consistently hit most while Korea and Taiwan have consistently benefited, but there is no immunity. Those with the ability to subsidize the loss over the downturn, or those with vertical integration where they can run lean, are the survivors. I'm not really sure where Solidigm fits into this because while Hynix has fully integrated their production portfolio, there was a lot of fat absorbed from Intel.Sometimes the company with the best product has the most trouble and this is certainly the case. Their engineering talent is impressive, I just hope they keep it.
cane - Thursday, October 26, 2023 - link
They have released new products. They are not for average Joe, though...https://www.solidigm.com/products/data-center/d5/p...
mode_13h - Thursday, October 26, 2023 - link
That's QLC, FYI. Furthermore, because it's a new product, I wouldn't expect as much discounting as you can find on some of their existing models.FunBunny2 - Thursday, October 26, 2023 - link
people will continue to buy and upgradeif your storage needs are modest (not thousands of videos, for example), and your space is in the form of MLC (mine are), it's likely that you'll never need new devices. you'll die first.
as to pricing: there's a problem with any tech-driven product, which is feeding fixed cost. I suspect that the NAND/SSD manufacturers have it down to +/- $.000x per unit. labour is an ever smaller fraction of product cost, which means that if you cut output, you must, of necessity, increase price to clear that fixed cost. or, to put it another way: for centuries bidnezz has used capital not for its intrinsic value, but as labour substitution. production gets to the point where there's little to no labour to substitute out. what does bidnezz do then? the smart ones, minuscule few, realize that moving more widgets is the answer, but said solution is not fully under their control. in order to move more output, the public must needs have sufficient funds, and needs, to buy evermore. quoth the Raven.
mode_13h - Friday, October 27, 2023 - link
> it's likely that you'll never need new devices. you'll die first.Don't expect sympathy when they die. And don't bother using a data recovery firm, as I've heard SSDs tend to be entirely unrecoverable, whereas you can usually salvage something from HDDs.
Also, don't leave them powered off, too long.