DRAM market posts better-than-forecasted Q1
By Colleen Taylor, Contributing Editor -- EDN, April 27, 2007
Despite frustrations stemming by falling average selling prices (ASP) and a sequential revenue slowdown, analysts at market research firm iSuppli said in a report released today that the global DRAM market is not in as bad shape as it may seem.
Global DRAM revenue declined sequentially to $9.7 billion in Q1, down nearly 10 percent from $10.7 billion in Q4 2006, iSuppli said. The major factor behind the decline, according to the firm, was a 26 percent decline in ASPs during the quarter.
However, global DRAM revenue increased by a very encouraging 49 percent year-over-year compared to Q1 2006, the firm said. In addition, quarterly DRAM bit shipments in the market grew by 21 percent sequentially, which represents the highest growth rate since Q3 2002, iSuppli said.
According to iSuppli, the solid unit growth rate explains why DRAM prices have fallen significantly during the quarter. In fact, the firm said, the global DRAM sales of $9.7 billion turned out to be slightly higher than iSuppli's forecast of $9.4 billion.
In addition, the ASP drop did not have a hugely negative effect; higher-than-expected bit growth offset the impact of the lower-than-expected ASP in Q1, iSuppli said.
Market leaders
On a company-by-company basis, Hynix Semiconductor Inc. achieved the strongest performance of all DRAM suppliers in Q1, allowing it to come within striking distance of market leader Samsung Electronics Co. Ltd., according to iSuppli. While every other global supplier suffered a sequential decrease in sales, Hynix had DRAM revenue of $2.2 billion in Q1, up 4.1 percent from its Q4 revenues. In addition, the company's overall revenues were up a whopping 69 percent year-over-year. Meanwhile, Samsung had Q1 revenues of $2.5 billion, down 15.9 percent from its Q4 revenues.
"Hynix rocked in the first quarter," Nam Hyung Kim, director and principal analyst for iSuppli, said in a statement. "The company's strong performance was due to its higher-than-expected production using 80-nm process technology and its capacity reallocation from NAND to DRAM."
Nevertheless, with 26.1 percent market share Samsung led iSuppli's ranking of the top-10 DRAM suppliers for Q1. Hynix was in a relatively close second, however, with 22.2 percent market share. In third place was Qimonda with 13 percent, followed by Elpida with 12.4 percent. Micron took fifth place, with a 9.1 percent market share, and sixth-ranked Powerchip and seventh-ranked Nanya followed with 5.4 percent and 5.3 percent market share, respectively. In eighth place was ProMos with 4.1 percent, in ninth was Etron with 0.9 percent, and in 10th was Winbond with 0.5 percent.
