Various MLCC suppliers’ book-to-bill ratios as well as quarterly shipments for 4Q21 now show signs of decline, according to TrendForce’s latest investigations. Not only has the demand for consumer electronics slowed, but ODMs’ clients have also eased their procurement activities due to issues including the global chip shortage, mismatched component availabilities, and China’s power rationing. Demand in the automotive market, on the other hand, has remained strong since 3Q21. Automotive applications have therefore become an important point of focus in MLCC suppliers’ latest product planning and capacity expansion efforts. Thanks to these in-demand applications, annual MLCC demand from the automotive market for 2021 is expected to reach 449 billion pcs, a 20% YoY increase.

TrendForce further indicates that the growth of the EV market and improvements in ADAS specifications have resulted in a twofold increase in automotive MLCC consumption. While EVs’ electrified drivetrain and high safety requirements represent a high barrier to entry for MLCC suppliers, these hurdles have also in turn raised MLCC products’ ASP and profitability. Hence, the automotive electronics industry has been increasing its annual MLCC demand by double-digits in recent years. In particular, an analysis of different vehicles and their respective MLCC consumption reveals the following: a conventional EV requires 2.2 times the MLCC usage of a conventional gasoline vehicle, an ADAS-equipped EV requires 2.7 times, and an autonomous EV requires as much as 3.3 times.

Regarding MLCC suppliers, Japanese companies including Murata, TDK, and Taiyo Yuden continue to dominate the automotive MLCC market. These suppliers will expand their production capacities for automotive applications in overseas facilities in China, Philippines, and Malaysia next year, with powertrains, ADAS, and connected systems being among the most significant of the aforementioned applications. Korea-based Samsung, on the other hand, specializes in powertrain applications by leveraging its MLCC offerings’ small form factor, high capacitance, and high voltage. Finally, Taiwanese suppliers, such as Yageo and Walsin, are actively invested in developing automotive products and High-Q products for RF applications in an effort to increase their presence in the infotainment system market and EV charging station market.

Looking ahead to 2022, TrendForce expects annual automotive MLCC demand to reach 562 billion pcs, a 25% YoY increase, primarily attributed to the continued electrification of vehicles. While the global implementation of carbon-neutral policies and excellent sales performances of Tesla vehicles bring about widespread adoption of EVs, various countries have successively set concrete dates for the termination of gasoline vehicle sales. Hence, EVs are gradually becoming not only the mainstream option in the automotive market, but also the primary driving force behind the future growth of the MLCC industry.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

Despite the forecasted 18.6% YoY growth in total DRAM bit supply next year, the global DRAM market is still expected to shift from a shortage situation to an oversupply, according to TrendForce’s latest investigations. This shift can primarily be attributed to the fact that, not only are most buyers now carrying a relatively high level of DRAM inventory, but DRAM bit demand is also expected to increase by only 17.1% YoY in 2022. On the price front, the oversupply situation will result in a drop in DRAM ASP in 2022 but not a major decline in annual DRAM revenue, thanks to the oligopolistic nature of the DRAM industry. Annual DRAM revenue for 2022 is expected to reach US$91.54 billion, which represents a slight YoY increase of 0.3%.

Based on an analysis of DRAM sufficiency ratio (which refers to the surplus of supply in comparison with demand) for each quarter in 2022, TrendForce forecasts a 15% YoY decrease in DRAM ASP for 2022, with prices undergoing the more noticeable declines during the first half of the year. Heading into 2H22, however, owing to the rise in DDR5 penetration rate, as well as the arrival of peak seasonal demand, the decline in DRAM ASP will likely narrow. TrendForce does not rule out the possibility that DRAM ASP may even hold flat or undergo an increase in 2H22.

Annual NAND Flash revenue is expected to experience yet another increase next year by 7.4% YoY while numerous suppliers compete in higher-layer NAND Flash market segment

Turning to the NAND Flash market, TrendForce forecasts a 31.8% increase in total bit supply for 2022 and a 30.8% increase in total bit demand. Hence, NAND Flash ASP will likely experience a downtrend next year as a result of the oversupply situation. In addition, due to the perfect competition in the NAND Flash market, the decline in NAND Flash ASP next year will be more noticeable than the decline in DRAM ASP. However, NAND Flash suppliers continues to make progress in the stacking of NAND Flash layers, so the growth in NAND Flash bit supply next year will therefore remain above 30%. TrendForce thus expects NAND Flash revenue to have more room for growth and reach US$74.19 billion in 2022, a 7.4% YoY increase.

TrendForce’s forecast based on an analysis of NAND Flash sufficiency ratios for each quarter in 2022 similarly points to an 18.0% YoY decline in NAND Flash ASP next year. Much like DRAM, NAND Flash prices will undergo the more noticeable declines during 1H22. Arrival of peak seasonal demand in 2H22 will potentially result in a narrowing of price drops and a potential for quarterly prices to hold flat.

On the whole, the revenue performance of the DRAM industry and that of the NAND Flash industry over the years show that the annual total DRAM revenue is growing at more stable pace. Again, this has to do with the oligopolistic structure of the DRAM market. Since the DRAM market has a different competitive landscape, the fluctuations in the overall DRAM ASP have been relatively modest over the long run. However, the development of the DRAM manufacturing technology is approaching a physical bottleneck as process nodes shrink below the 20nm level. This means that the bit growth derived from the deployment of a more advanced process is becoming more and more limited over the years. On the other hand, not only are NAND Flash suppliers relatively more unstable in their capacity expansion plans compared to the DRAM industry, but further improvements in NAND Flash layer-stacking technology also remains feasible. Hence, the fluctuations in the overall NAND Flash ASP have been relatively more volatile over the long run. On account of these factors, the DRAM industry generally has smaller YoY revenue growth rates compared with the NAND Flash industry, although the DRAM industry continues to surpass the NAND Flash industry in terms of profitability.

Profitability of suppliers may be constrained if total revenue fails to keep pace with continuously rising CAPEX

Regarding the CAPEX (capital expenditures) of DRAM suppliers, there has been a gradual increase in these suppliers’ CAPEX to sales ratio in recent years, for two reasons. First, the development of the DRAM manufacturing technology is approaching a physical bottleneck. Die improvements have become more and more limited after process nodes have shrunk below the 20nm level. Micron’s 1alpha nm process can offer an almost 30% increase in bits per wafer, but the 1Xnm-to-1Ynm migrations and the subsequent 1Ynm-to-1Znm migrations that the major suppliers have undertaken in the recent period have yielded increases of no more than 15% in bits per wafer. Looking at future technological developments, Samsung and SK hynix have already integrated EUV lithography into their most advanced process technologies. However, orders for EUV lithography tools have a much longer lead time, and the costs of these tools are also high. Hence, the three dominant suppliers have allocated a large chunk of capital expenditure in advance to place orders for EUV lithography tools ahead of time.

Secondly, the oligopolistic structure of the DRAM market has also helped establish a regime where there is a very low chance of a supplier’s ASP dipping under its fully-loaded cost despite the recurrence of the cyclical price downturn. Moreover, DRAM suppliers have accumulated a substantial amount of profit from their products. In view of the difficulties in die shrinking, suppliers ranging from the three dominant suppliers to others with less market share (such as Nanya Tech and Winbond) have developed tangible plans for capacity expansions. These plans have, in turn, become the other main driver behind the ongoing increase in the CAPEX to sales ratio.

The CAPEX to sales ratio of NAND Flash suppliers have likewise risen substantially following the transition to 3D NAND technology in 2017. Notably, the average CAPEX to sales ratio fell within the 25-30% range prior to 2017, but it has since climbed to nearly 40% as of now. This growth can primarily be attributed to the fact that, as the number of 3D NAND layers increases, there is a corresponding increase in the lead times of NAND Flash products and in the degree of precision as well as difficulty involved in the etching process. While the mainstream layer count of NAND Flash products approaches 1YY layers, suppliers are currently planning to move forward with the development of products with 2XX layers, which place an ever-increasing demand on etch depth. The CAPEX of NAND Flash suppliers will continue to grow alongside increases in layer count and revenue.

TrendForce indicates that NAND Flash layer-stacking technology will continue to progress, meaning suppliers will continue to pursue the stacking of additional layers as a way to lower their manufacturing cost per GB. As such, the NAND Flash industry’s CAPEX will have additional potential for growth going forward, with a CAPEX to sales ratio of close to 40% or above. It should be noted, however, that if total NAND Flash revenue fails to keep pace with the growth in CAPEX in the next few years, NAND Flash suppliers’ CAPEX to sales ratio may potentially undergo an excessive increase, thereby constraining the profitability of suppliers.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

The emergence of the COVID-19 pandemic led to severe delays in manufacturing and logistics. In particular, governments worldwide began implementing border restrictions in 2Q20 to combat the ongoing health crisis, leading to a sudden decline in order volumes for channel-market SSDs, according to TrendForce’s latest investigations. Annual shipment of SSDs to the channel (retail) market reached 111.5 million units in 2020, a 15% YoY decrease. In terms of market share by shipment, Kingston, ADATA, and Kimtigo once again occupied the top three spots, respectively.

Looking at the channel market for SSDs as a whole, NAND Flash suppliers (among which Samsung possessed the largest market share) accounted for around 35% of the total shipments in 2020, while SSD module makers accounted for the other 65%. The top 10 module makers accounted for 71% of channel-market SSD shipments from all SSD module makers. Taken together, these figures show that the market remained relatively oligopolistic in 2020. However, it should be noted that TrendForce’s ranking of SSD module makers for 2020 takes account of only products bound for the channel market and under brands owned by the module makers themselves; NAND Flash suppliers were therefore excluded from the top 10 ranking.

As the pandemic eliminated tier-2 and tier-3 suppliers at an increasingly rapid pace, the collective market share of the top 10 module makers continued to rise

Kingston demonstrated the competitive advantage that it derived from having a global strategy while the pandemic took place. The company saw its market share increase by 1% against market headwinds in 2020 and comfortably took the number one spot among the top 10 SSD module makers. At the same time, Kingston sourced its SSD controller ICs from a diverse group of suppliers in order to avoid potential issues with SSD production due to insufficient foundry capacities. By ensuring a stable supply of controller ICs, Kingston will likely raise its market share even further going forward. On the other hand, ADATA had previously shifted the focus of its R&D and manufacturing operations to SSD products. Not only did ADATA release high-end products ahead of most of its competitors, but it also raised its markets share thanks to the increased demand for its gaming products during the pandemic. ADATA took the second spot on the top 10 list.

Kimtigo, ranked third on the list, shifted its focus to mid-range and high-end products due to their relatively high profitability. Furthermore, Kimtigo successfully expanded its market share both overseas and online, in turn taking the number one position in China. In light of China’s policies prioritizing domestic semiconductor production as well as Kimtigo’s ongoing efforts to cultivate a presence in tier-3 and tier-4 cities in China, the company will likely continue to increase its market share going forward. Netac similarly possessed comprehensive sales networks in China and the overseas markets, in addition to having committed to long-term developments in online sales channels. As the pandemic drove up online sales last year, Netac was able to leapfrog to fourth place in the rankings. Likewise, Lexar saw a slight growth in its market share last year due to not only the comprehensive global sales network it had previously developed, but also its gradually maturing manufacturing operations and aftersales customer services.

The COVID-19 pandemic drove up orders for Teclast’s self-branded notebook computers and displays. As a result, Teclast’s shipment of SSDs last year underwent an increase that in turn led to a corresponding increase in its market share. As for Colorful and Galaxy, the two companies primarily focused on the gaming market. Hence, the increase in demand for gaming consoles and high-end notebooks allowed Colorful and Galaxy to enjoy increased visibility in the SSD market. Lenovo’s shipments fell slightly in 2020 because the other competing brands increased their efforts in developing the overseas markets. As a result, its place in the ranking also dropped from 2019. As the ranking indicates, the competition among brands in the Chinese market remained very intense. There is the possibility that the brands’ positions in the ranking will undergo more reshuffling for 2021.

It should be pointed out that TrendForce has noted the participation of additional brands in the SSD module market in recent years. One such brand is Gigabyte, which has registered remarkable performances. Gigabyte grew its shipment of SSD products by more than 30% YoY in 2020 through leveraging its preexisting reputation in the motherboard and graphics card markets. Although Gigabyte has yet to enter the top 10 list at the moment, it will likely do so within the coming years thanks to its comprehensive global sales network and the growing visibility of its SSD products.

Rise of YMTC strengthens China’s domestic NAND Flash production, and Chinese SSD manufacturers are gradually gaining a brand advantage

As the trend of the localization of semiconductor manufacturing comes to the forefront of the Chinese memory market, YMTC is carrying out a massive capacity expansion plan. In terms of layer technology, YMTC is steadily advancing to 128L and catching up to the major NAND Flash suppliers. Among Chinese SSD brands, Biwin secured financial support from the China IC Industry Investment Fund (the Big Fund) this September; it is now expanding the production capacity of its plant in Huizhou. Besides this, Biwin has also acquired sufficient product development capability to meet clients’ demand for customized products and services. The company is therefore expected to experience a wave of growth in the future.

Turning to Taiwan-based SSD brands, Liteon’s shipments of branded SSDs have slowed down significantly after the company was fully incorporated into Kioxia in July 2020. Due to certain considerations pertaining to the allocation of internal resources, Kioxia will assign the Liteon SSD team to support the development of SSDs for PC OEMs. In the future, Kioxia’s focus will not be on brand development. As for other Taiwan-based SSD brands, they will unlikely return to the top 10 ranking because they have not been able to catch up to the brands based in Mainland China with respect to the economies of scale. TrendForce believes that Taiwan-based brands will continue to be on the decline.

PCIe G4 SSDs become new main offerings, and module makers have adopted QLC solutions

The effects of the COVID-19 pandemic have contributed to a significant increase in the average memory density of SSDs this year. With 512GB becoming the mainstream capacity size, the cost advantage of QLC will become increasingly recognizable. Hence, module makers will be introducing QLC products into their SSD offerings. In the aspect of interface technologies, the proportion of SATA in the retail SSD market has been declining over the years, and module makers are switching to PCIe for their new products. TrendForce’s research finds that PCIe products accounted for almost 30% of retail SSDs shipped in 2020. With shipments of PCIe G4 SSDs expected to grow rapidly in the future, module makers will assign PCIe as the mainstream interface for new products.

Also, an increasing number of Chinese IC design houses are now involved in the development of SSD controller ICs. This, in turn, has led to more PCIe G4 SSD controllers entering mass production. As China pursues the localization of semiconductor manufacturing, module makers will be tested to develop suitable solutions that can maintain growth in the Chinese market.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

Contract prices of NAND Flash products are expected to undergo a marginal drop of 0-5% QoQ in 4Q21 as demand slows, according to TrendForce’s latest investigations. Hence, the current cyclical upturn in NAND Flash prices will have lasted for only two consecutive quarters. Looking ahead, NAND Flash suppliers’ capacity expansion plans will be affected by the outlook on future trends and the supply of other non-memory components. At the same time, attention will have to be paid to the demand projection. At the moment, NAND Flash suppliers appear likely to downsize their capacity expansion activities for 2022, resulting in a 31.8% YoY increase in NAND Flash bit supply next year. Annual bit demand, on the other hand, is projected to increase by 30.8% YoY. With demand being outpaced by supply and competition intensifying among suppliers for higher-layer products, the NAND Flash market will likely experience a cyclical downturn in prices in 2022.

YoY Growth of bit supply for 2022 is projected to reach 31.8% as competition for higher-layer NAND Flash remains fierce

With demand surging for a significant part of this year, customers have accelerated their adoption of higher-layer NAND technologies. Suppliers have also revised their production plans several times so as to raise output, reaching a YoY growth of nearly 40% in total NAND Flash bit supply in 2021. In light of the somewhat high base for comparison and the relatively weak demand outlook next year, TrendForce expects annual NAND Flash bit supply to increase by only about 31.8% YoY in 2022.

NAND Flash bit demand will grow by just 30.8% due to high base for comparison and factors related to arrival of post-pandemic era

The analysis of the demand side of the NAND Flash market finds that the shipment volumes of smartphones, notebook computers, and servers have been undergoing robust growths in 2021, resulting in a relatively high base period for comparison against next year’s figures. Hence, substantial YoY increases in device production or shipment in 2022 will be difficult. In addition, the procurement side still suffers from mismatched availability of components. With NAND Flash supply being relatively healthy and device manufacturers carrying a growing NAND Flash inventory, NAND Flash procurement for the upcoming period will likely be limited. TrendForce expects NAND Flash bit demand to increase by 30.8% YoY in 2022, which represents a slower growth compared with the increase in NAND Flash bit supply.

Regarding the smartphone market, the persistent shortage of components, including chipsets and driver ICs, is expected to exacerbate the decline in smartphone shipment during the traditional off-season of the first quarter. As for the average storage capacity of handsets, one driver of growth is the iPhone series, which is adopting a 1TB solution for the first time with this year’s line-up (i.e., iPhone 13 Pro/Pro Max). This will encourage brands in the Android camp to follow suit and have a 1TB solution featured in the future flagship models that are released in 2022, thus slightly increasing the shipment share of high-density solutions. Furthermore, brands in the Android camp will be focusing on pushing models with 256GB or 512GB in response to Apple’s storage upgrade for this year’s iPhone lineup. TrendForce forecasts that the NAND Flash bit demand related to smartphones will rise by around 28.5% YoY in 2022, which is noticeably lower than the growth rates that approached almost 30% for the years prior to 2021.

Regarding the notebook market, orders for notebook computers will enter a period of downward correction in 2022 compared to the peak growth that took place in 2021 as increasingly widespread vaccinations lead to a gradual easing of border restrictions. Although the workforce’s return to physical offices has now generated some upside demand for commercial notebooks, the demand for consumer notebooks and Chromebooks, which are highly contingent on the education sector, will undergo a sharp decline. Taking these factors into account, TrendForce forecasts a modest 23.2% YoY growth in client SSD bit demand in 2022, which falls short of the growth in 2021 by a considerable margin.

Regarding the server market, CSPs’ continued procurement of servers in 2022 is expected to drive up annual server shipment by about 4.5% YoY. In particular, the average storage capacity of enterprise SSDs is expected to experience a more significant growth next year compared to previous years due to the gradual release of new server CPU platforms with PCIe Gen 4 support, which features more PCIe lanes allocated to SSD data transfer. These new CPUs will also come with substantial upgrades in terms of both core count and processing power. Adoption of large-capacity enterprise SSDs enables servers equipped with such CPUs to achieve improved computing performance and in turn allows CSPs to cut down on the number of server nodes required, thereby optimizing the cost of data center build-out. In terms of applications, computing demand from AI and big data will continue growing, and this growth will also contribute to the increase in the average storage capacity of enterprise SSDs next year. In addition to the aforementioned developments, the release of Intel’s Sapphire Rapids platform, which supports PCIe Gen 5, will bring about a further bump in enterprise SSD data transfer speed, as well as average storage capacity, which is expected to increase by 33.5% YoY in 2022.

Annual NAND Flash revenue is projected to increase by merely 7% YoY in 2022 while falling quotes offset growth in bit shipment

NAND Flash ASPs have not shown significant downturns for two consecutive years since 2020. At the same time, as the COVID-19 pandemic drives up the demand for electronic products and cloud services, the overall growth in NAND Flash bit demand has been remarkable, resulting in an annual NAND Flash revenue growth of more than 20% YoY in both 2020 and 2021. Looking ahead to 2022, the YoY increase in NAND Flash bit demand will diminish due to the high base for comparison this year. The NAND Flash market is projected to enter a period of price downturn, with an over 18% decline in NAND Flash ASP. While such a decline offsets the rise in bit shipment, annual NAND Flash revenue will likely increase by merely 7% in 2022, the lowest YoY growth in three years.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

DRAM contract prices are likely to exit a bullish period that lasted three quarters and be on the downswing in 4Q21 at a QoQ decline of 3-8%, according to TrendForce’s latest investigations. This decline can be attributed to not only the declining procurement activities of DRAM buyers going forward, but also the drop in DRAM spot prices ahead of contract prices. While the buying and selling sides attempt to gain the advantage in future transactions, the DRAM market’s movement in 2022 will primarily be determined by suppliers’ capacity expansion strategies in conjunction with potential growths in demand. The capacity expansion plans of the three largest DRAM suppliers (Samsung, SK hynix, and Micron) for 2022 are expected to remain conservative, resulting in a 17.9% growth in total DRAM bit supply next year. On the demand side, inventory levels at the moment are relatively high. Hence, DRAM bit demand is expected to grow by 16.3% next year and lag behind bit supply growth. TrendForce therefore forecasts a shift in the DRAM market next year from shortage to surplus.

Total DRAM bit supply is projected to grow by 17.9% in 2022 in light of DRAM suppliers’ low inventory levels and resurging demand in the server market

As buyers expanded their DRAM procurement in 1H21 in response to supply chain disruptions, DRAM suppliers were able to register better-than-expected shipment performances and reduce their inventory levels considerably. These suppliers are now bullish on the growth of DRAM bit demand generated by the resurging server market. In particular, while Samsung and SK hynix have marginally increased their wafer input for DRAM products, DRAM suppliers’ process technologies are continuing to migrate towards the 1Z nm and 1alpha nm nodes. TrendForce therefore expects total DRAM bit supply to increase by 17.9% YoY in 2022.

Most of Samsung’s wafer input growth takes place in the P2L fab, which houses relatively large physical spaces. As the prevailing market leader, Samsung will likely continue to increase wafer input for DRAM products going forward. The company’s DRAM bit supply growth for 2022 is expected to reach 19.6%, the highest out of the three dominant suppliers, despite the relatively modest growth in Samsung’s current wafer input, most of which comes from advanced process technologies. It should also be pointed out that Samsung’s newest fab P3L is expected to be fully built by mid-2022. P3L will likely contribute to DRAM production by a limited amount next year but continue to provide further growth for Samsung’s DRAM supply after 2023.

Given the bear market for DDR3 memory, SK hynix will likely speed up the reallocation of wafer capacity from DRAM to logic IC products at its old M10 fab next year. After kicking off DRAM production at its newest M16 fab this year, SK hynix will see its total production capacity for DRAM chips continue expanding in 2022, although the company will also adjust its DRAM output according to the state of the market. SK hynix is currently focused on raising the yield rates of its 1Y nm and 1Z nm process technologies, which will contribute to the forecasted 17.7% increase in SK hynix’s total DRAM bit supply next year.

The latest expansions at Micron’s A3 fab are primarily undertaken as a safeguard against possible wafer losses during the fab’s upcoming transition to next-gen process technologies. Hence, Micron’s total production capacity will unlikely undergo drastic changes for the 2021-2022 period, and growths in its DRAM bit output will be mostly derived from the increased yield of the 1Z nm and the latest 1alpha nm process technologies. In addition, DRAM products manufactured with Micron’s 1alpha nm process technology have been widely adopted by clients, and Micron has been making the fastest progress in terms of process technology migration among the three largest DRAM suppliers. The company is expected to increase its DRAM bit supply by 16.3% next year.

Regarding Taiwanese suppliers, Nanya Tech is expected to finalize the construction of its new fab in 2024, while Winbond’s new fab is expected to kick off only pilot runs in 2H22. Taiwanese suppliers are therefore expected to make very limited contributions to the increase in total DRAM bit supply in 2022.

DRAM bit demand is expected to increase by merely 16.3% in 2022, as the bear market for various products results in a high base period in 2021

The smartphone, server, and notebook computer segments comprise the three largest sources of DRAM consumption. All three product categories have been seeing tremendous growth in 2021, thereby resulting in a high base period for comparison against next year’s figures, meaning that significant YoY growths in these products’ production and shipment, and subsequently their DRAM consumption, for 2022 are unlikely to take place. Furthermore, the ongoing shortage of components has continued to affect various industries and constrain device assembly, leading to a decline in demand for DRAM, since OEMs/ODMs are carrying a relatively high level of DRAM inventory. For 2022, DRAM bit demand is expected to increase by only 16.3% and lag behind DRAM bit supply.

Regarding smartphones, while the shortage of key components such as chipsets and driver ICs remains unresolved, total smartphone shipment for 1Q22, which is already a period of cyclical downturn, will fall below expectations. Although the upcoming release of new models is expected to bring about quarterly increases in smartphone production, TrendForce’s current forecast indicates an annual production volume of about 1.4 billion units for 2022, a modest 3.5% YoY growth. This forecasted figure will likely be subject to additional declines if the shortage of semiconductor components extends further. As such, the main growth driver of mobile DRAM demand in 2022 is expected to be the increase in “content per box” (which refers to the total DRAM contained within each individual handset). For 2022, mobile DRAM will account for approximately 40% of total DRAM bit consumption; there will likely be a 15% increase in mobile DRAM bit demand as well. This increase represents a relatively sluggish performance, as mobile DRAM demand generally increased by more than 20% YoY in previous years.

The server industry likewise faced supply chain-related issues, including disruptions in server assembly operations based in Southeast Asia, as well as shortages of PMICs and passive components. With these issues projected to persist through 2022, total server shipment is expected to increase by 4.3% in 2022, primarily thanks to CSPs’ data center expansions. On the other hand, the rise in Intel Ice Lake CPUs’ market share this year has led DRAM suppliers to manufacture more high-density dies (16Gb mono die) due to the server market’s surging demand for 64GB modules. Once Intel’s next-gen Xeon server CPUs, Sapphire Rapids, enter the market next year, the penetration rate of 64GB server DRAM modules is expected to surpass 60%. Hence, server DRAM bit demand is projected to increase by 20% in 2022, the highest among all DRAM product categories.

Annual shipment of notebook computers for 2022 is projected to reach 222 million units, a nearly 7% YoY decrease, owing to increased vaccination rates in Europe and North America. However, as WFH and distance education become the norm, annual notebook shipment will undergo some growth in the medium to long term, without falling back down to pre-pandemic levels. Although Chromebooks remained the fastest-growing product category among all notebooks in 1H21, demand for Chromebooks has been steadily declining in 2H21 due to the increased Chromebook inventory carried by distribution channels in response to high demand for educational notebooks in 1H21. Instead, demand has shifted to commercial notebooks, which are equipped with more DRAM capacity, and this shift will persist through 2022. Total PC DRAM bit demand is expected to increase by more than 15% next year.

DRAM revenue for 2022 will likely be mostly flat as bit shipment growth offsets decline in quotes

On the whole, DRAM suppliers have performed exceptionally well this year in terms of bit shipments thanks to OEMs’ energetic stock-up activities. The annual total revenue of the DRAM industry is also projected to surpass US$90 billion in 2021 because of the price uptrend and the growth in bit shipments. However, the DRAM market will begin to see prices falling in 4Q21 and a sharpening downtrend in 1H22. The overall ASP of DRAM products for the whole 2022 is projected to register a YoY drop of 15-20%. On the other hand, the YoY growth rates of DRAM suppliers’ bit shipments will also be within a similar range for next year. This means that the bit shipment growth will mostly offset the price decline, thereby keeping the total DRAM revenue for 2022 at a similar level to this year. There are still uncertainties as to the movements of DRAM prices during 2H22. If prices manage to rally, then the annual total DRAM revenue may again reach a new high.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com