Toshiba clips chips by a quarter

Chipmaker Toshiba is reducing production of its memory chips because of fall in demand and market oversupply.

The company said it will reduce its production of dynamic random-access memory (DRAM) chips by a quarter from 27 million units a month to 20 million.

The reduction will also see Toshiba close down one of its manufacturing lines at a plant in Japan next month.

The company blamed the ongoing economic downturn and said in a statement: "The impact is particularly severe in the memory market where weakening demand for mobile phones and personal computers is creating oversupply of memory products."

Toshiba said workers at the Yokkaichi plant will be moved to another production line in the same plant.