Nanya Technology Corp (南亞科技), the nation’s top DRAM chipmaker, yesterday said the rise in chip prices over the past 10 months would extend into this quarter because robust demand from smartphones and tablets has caused supply constraints.
A spike of 30.5 percent in DRAM prices last quarter returned Nanya to the black after three years of losses. The drastic price rise also helped boost the chipmaker’s gross margin to 19 percent last quarter from minus-85 percent in the final quarter of last year and minus-67 percent a year ago.
“We expect chip prices to rise mildly this quarter, which will further boost Nanya’s financial performance,” Nanya spokesman Lee Pei-ing (李培英) told a press conference.
Mobile devices have replaced PCs as the major driving force behind the recovery of the global DRAM sector, Lee said, adding that demand from servers, smartphones, tablets and Internet-enabled televisions has increased rapidly.
Revenues from non-PC sectors expanded to 60 percent at the end of last quarter from 49 percent in the fourth quarter of last year. That figure is expected to rise to 70 percent by the end of the year, with the biggest portion, or 50 percent, from DRAM chips used in consumer electronics, such as tablets and TVs, Lee said.
“We are cautiously optimistic about the industry this year,” Lee said, citing limited supply and growing demand.
Supply would be 2 percent lower than demand this quarter and the figure would increase to 5.5 percent in the fourth quarter, Lee said, citing Gartner Inc’s forecast.
Nanya last week posted quarterly profits of NT$506 million (US$16.97 million), or NT$0.02 per share, for the first three months of this year, including NT$4.5 billion in gains from inventory revaluation.
The chipmaker lost NT$8.88 billion in the final quarter last year and NT$10.35 billion in the first quarter of last year.
Inotera Memories Inc (華亞科技), a DRAM chip manufacturing venture between Nanya and US memorychip maker Micron Technology Inc, yesterday said prices would increase this quarter and that would help boost its financial results.
“It is certain that the second quarter will be better than the first quarter … chip prices will be better this quarter,” Inotera chairman Charles Kau (高啟全) told reporters.
Chip prices fell 4 percent last quarter on a quarterly basis because of a new pricing mechanism after Micron became the major buyer of Inotera’s chips.
Kau attributed the improvement to fast-growing demand from Chinese white-box smartphone and tablet makers, which are using lower-priced PC DRAM chips to cope with supply shortages of mobile DRAM chips.
Inotera would stick to its plan to reduce its non-PC revenue contribution to 50 percent at the end of this year, company president Scott Meikle said.
Global DRAM chip capacity has dropped 30 percent after deep price cuts forced numerous DRAM chipmakers out of the market and caused industrial consolidation, Kau said.
Inotera last week posted a smaller quarterly loss of NT$613 million for last quarter, from a NT$3.72 billion loss in the fourth quarter of last year and a loss of NT$4.45 billion in the first quarter of last year.
Inotera said it has swung back into profit of NT$1.13 billion last month.
The stock price of Nanya yesterday surged 6.96 percent to NT$6.15, while shares of Inotera plunged 6.75 percent to NT$11.05.