Adata sales soar on supply constraints, rising demand

By Lisa Wang  /  Staff reporter

Fri, Oct 06, 2017 - Page 12

Adata Technology Co (威剛科技), the world’s second-largest memory module maker, yesterday posted its strongest monthly revenue in almost four years, as a severe supply constraint coupled with improving demand boosted prices.

Revenue last month surged 34.43 percent to NT$2.93 billion (US$96.54 million) from NT$2.18 billion a year ago, the company said. On a monthly basis, it jumped 12.14 percent from NT$2.61 billion.

DRAM modules accounted for 61.52 percent of the company’s revenue last month, NAND flash modules took 30 percent and other products made up the remainder.

Revenue in the first nine months soared 51.89 percent annually to NT$24 billion, outpacing last year’s full-year sales of NT$23.22 billion.

The supply crunch is likely to be exacerbated by rapidly rising DRAM demand from global data center operators, Adata said.

“Rising data center demand is squeezing DRAM supply as chipmakers are allocating more capacities for [higher-priced] chips used in servers or data centers,” Adata chairman Simon Chen (陳立白) said in a statement.

DRAM demand is also increasing because of new smartphone and PC launches in the second half of the year, Adata said.

Chen said he does not see any quick fix to the ongoing constraints and prices are likely to continue rising into the second quarter of next year.

“This will mark the longest upcycle in the DRAM industry’s history,” Chen said.

Fueled by the strong demand, Adata expects its pre-tax profit to further increase this quarter, with the growth momentum extending into next year.

The recent prices hikes helped lift Adata’s pre-tax profit to NT$1.89 billion, or earnings per share of NT$8.66, in the first eight months of the year.