Shares of No. 1 and 2 memory chipmakers jumped in Seoul Thursday after U.S.-based No. 3 player Micron Technology Inc., announced plans to cut production amid sluggish demand, raising hope for recovery in chip prices and better performance in profitability.

Micron said in a conference call Wednesday after announcing earnings that it will “idle approximately 5 percent of DRAM wafer starts,” given lower DRAM demand outlook from customers, and also reduce “total NAND wafer starts by approximately 5 percent.” The decision is expected to help bring recovery in overall memory chip industry through improvement in supply and demand as Micron Technology will continue to cut production until stocks are empty.

Following Micron’s announcement overnight, shares of SK Hynix Inc. finished 7.66 percent higher on Thursday at 75,900 won ($67.3) and Samsung Electronics Co. 4.09 percent at 45,850 won.

In a report, Kiwoom Securities Co. said that Micron’s decision to cut output will allow demand to recover in the second half of this year and lead to overall industry improvement.”

The outlook for the demand side also improved.

Analysts believe the chip industry has bottomed out in the first quarter and forecast pickup in demand from July. Shinhan Investment Corp. said that DRAM industry will turn round on base effect of mobile DRAM in the second quarter and resumption of large-scale orders of server DRAMs in the third quarter.

Samsung Electronics accounted for 43.9 percent share in the global DRAM market with $43.75 billion revenue as of the end of 2018, according to DRAMeXchange. SK Hynix took up 29.5 percent share with $29.4 billion revenue and Micron Technology 23.5 percent.

By Lee Sang-duk and Lee Eun-joo

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