The global DRAM industry returned to growth last quarter as demand rebounded, ending a recession that lasted for three quarters, TrendForce Corp (集邦科技) said yesterday.
The demand recovery was caused by reduced inventories and pre-emptive orders by vendors that want to ward off heavy tariffs imposed by the US, the Taipei-based market researcher said in a report.
The growth in shipments is likely to carry into the current quarter, as the world’s top three DRAM suppliers are expected to boost output to cope with rising demand for memory chips used in servers and mobile phones, TrendForce said.
Growth in global output should not be a concern next year, it added.
In terms of production capacity, Samsung Electronics Co, the world’s biggest DRAM supplier with a 46 percent market share, is to keep total capacity unchanged next year from this year, while SK Hynix Inc of South Korea would be conservative about capacity expansion at its Chinese factories, as Chinese products might continue to be subject to higher US tariffs, the researcher said.
DRAM chip prices are showing stability this quarter, following a 20 percent quarterly decline last quarter that squeezed chipmakers’ profits margin, TrendForce said.
Against this backdrop, Samsung would be less willing to cut chip prices this quarter, as its operating margin dropped to 33 percent last quarter, hovering slightly above its mid-to-long-term low of 30 percent, TrendForce said.
The South Korean company’s DRAM shipments last quarter rose about 30 percent quarterly, benefiting from Chinese mobile phone vendors’ pre-emptive orders and improving demand from the server segment, which helped prop up revenue by 5 percent to US$7.12 billion, the researcher said.
Shipments at SK Hynix and Micron Technology Inc last quarter grew 20 percent and 30 percent respectively from a quarter earlier, it said.
Nanya Technology Corp’s (南亞科技) shipments soared 35 percent from the previous quarter, outperforming its peers, but the Taiwanese firm could see a quarterly decline in shipments this quarter due to a higher comparison base, the researcher said.
It could take a longer time for the firm to see a rebound in net profit, it added.
Nanya Technology reported that operating margin tumbled to 15.2 percent last quarter from 22.5 percent in the prior quarter.
The company last month said that shipments this quarter would be flat or drop slightly from last quarter.
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