The company will pull out of memory chip production by March 1999 as part of a reorganization of five Hitachi chipmaking subsidiaries.
The reorganization of deficit-ridden chip units will be completed by next spring, the report said. At that time, it will focus on microcontroller chips which go into PCs and camera.
Last month, Oki Electric one of Japan's top manufacturers of microchips and communications products, said that it will move away from memory chip production.
The news follows an announcement made a week earlier by Texas Instruments (TI) stating that it is selling off its stake in a Taiwanese memory chip facility to Acer as part of an effort to reduce the company's exposure to the volatile memory chip market.
This, in turn, followed the February collapse of a major joint memory chip venture between Hitachi and TI, which also fell apart under the weight of tumbling memory chip prices.