Fri, May 25, 2018 - Page 12 News List

Nanya predicts high DRAM chip demand through Q3

UPBEAT ANALYSIS:Mobile phone sales are slowing, but DRAM supply remains constrained amid healthy demand for notebooks and niche applications, the company said

By Lisa Wang  /  Staff reporter, in TAOYUAN

DRAM chipmaker Nanya Technology Corp (南亞科技) has forecasted record high revenue for this quarter as it cranks out more chips to meet demand, a company executive said yesterday.

Chip prices would remain stable or rise mildly as supply remains constrained this quarter, following a 35 percent price hike last year, the company said.

“It looks like the company’s core business will be quite good this year,” Nanya president Lee Pei-ing (李培瑛) told a news conference in Taoyuan, adding that he expects the company to deliver “a higher payout ratio next year than this year’s 27 percent.”

Shareholders yesterday approved a company proposal to distribute a cash dividend of NT$3.56 per common share, representing a 3.49 percent yield on the company’s closing price of NT$102.

Nanya’s positive outlook is based on rapidly growing demand from server operators and recovering demand from Chinese vendors amid rising penetration rates of entry-level mobile phones in India, and developing countries in African and elsewhere, it said.

The DRAM industry is also supported by the notebook computer segment, as demand from manufacturers looks stable and healthy, the company said.

Premium smartphones this year are equipped with more memory to handle more computing tasks and artificial intelligence applications, Lee said, adding that this provides a buffer to slowing growth in the high-end phone segment.

Mobile phones are still the biggest consumer of DRAM chips, the company said.

Nanya expects an output expansion drive that involves improving the yield rate of its 20-nanometer technology to add to revenue growth, Lee said.

“The company’s shipments will grow each month through the third quarter,” Lee said. “Coupled with a positive price outlook, there is a chance for us to see monthly improvements in revenue [this quarter].”

Nanya’s revenue set a quarterly record of NT$18.8 billion (US$628 million) in the first three months of the year.

Niche DRAM chips for TV set-top boxes and other electronics made up about 65 percent of the firm’s total revenue, while low-power DRAM chips, which are mostly used in mobile phones, contributed about 15 percent and commodity DRAM chips, mostly used in computers, accounted for about 10 percent, the company said.

The DRAM industry would remain healthy for most of the year until major memory makers, including Samsung Electronics Co, start supplying more chips in the final quarter, Nanya said.

The company said it hopes to maintain growth by entering the server market with its latest 8 gigabyte DDR4 chips in the fourth quarter.

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