DRAM market is showing good signs of profit with the rise in price of some of the mainstream DRAM chips. Vendors of the DRAM chips able to make profit and control the price by controlling the production based on the demand. There is now less over supply and no high demand.
DRAMeXchange has reported the average price for mainstream 4GB modules rose by 16% in the second quarter, from US$23.50 to US$27.25. DRAM manufacturers’ second quarter revenue broke records, increasing by 24% QoQ to US$8.53 billion for the highest quarterly revenue growth in three years, finds DRAMeXchange.
Korea's Samsung and SK Hynix together hold a market share hit 62.7%, a slight decrease compared to the previous quarter. Hynix' DRAM' revenues grew by 40.7% quarter over quarter, whereas Samsung revenue grew by 7.7% QoQ. 40% of Samsung's production is now mobile DRAM, finds DRAMeXchange. Although mobile memory is the supplier’s most profitable product, the 5-8% QoQ contract price decrease in the second quarter resulted in a drop in mobile memory revenue, bringing down Samsung’s overall DRAM revenue, says DRAMeXchange.
Other details shared by DRAMeXchange includes:
Elpida and Micron took 15.2% and 12.9% of the DRAM market, respectively, putting the suppliers in third place with a combined market share of 28% after their merger on August 1. Elpida’s revenue increased by 37% QoQ due to commodity DRAM price recovery and as well as a slight increase in bit volume from subsidiary Rexchip. Looking at the new team’s revenue outlook, mobile DRAM will account for over 20% of total revenue, which will have a significant impact on the market.
As for Taiwanese suppliers, Nanya’s third quarter revenue increased by nearly 58.8% QoQ due to the rise in specialty and commodity DRAM prices. Currently, Nanya still has commodity DRAM in production although the supplier has made the transition to a foundry. The manufacturer will continue to lower production and work on increasing the proportion of 30nm mobile DRAM to improve profitability. The bulk of Powerchip’s revenue comes from foundry business as well – after selling its P3 fab equipment to Kingston, the plant is dedicated entirely to the production of commodity DRAM. However, unlike their previous business model, Kingston now supplies all production materials, resulting in a 43% QoQ decrease in revenue for Powerchip. Winbond’s revenue increased by 14.7% QoQ due to the increase in specialty memory prices.
As the peak sales season for consumer electronics arrives and Winbond begins production on low-density mobile DRAM, the supplier’s revenue will likely continue growing steadily. Looking at the market perspective, TrendForce believes that as the DRAM industry becomes an oligopoly, supply and demand will no longer be the only factor affecting price fluctuations. As DRAM suppliers that have an oligopoly or monopoly on a specific memory product will be able to exert control over market prices, the major price fluctuations seen in recent years are unlikely to recur, resulting in a more promising future for the DRAM market.