DRAMeXchange: WW DRAM revenue merely increase 3.4% in 3Q10

DRAMeXchange: WW DRAM revenue merely increase 3.4% in 3Q10

Nov. 2nd, 2010--According to DRAMeXchange, the research division of Trendforce, despite of 15% QoQ output growth in 3Q10, DRAM industry recorded US$10.8B, which is merely 3.4% QoQ growth compared to US$10.4B in 2Q10 given the further 3Q10 contract price decline. 

Since 3Q10 DRAM contract price is impact by the DRAM output growth and unsatisfactory PC demand in hot season, DRAM price indicated the downward trend. 3Q10 DDR3 2GB “Average” contract price declined 13% QoQ to US$40 from US$46 in 2Q10 while spot DDR3 1Gb eTT chip dropped 18% QoQ to U$2.27 and DDR2 1Gb eTT chip was down 16% QoQ. 

DRAM vendors are more conservative toward future CAPEX given the sharply price decline from 3Q10. Samsung may adjust construction plan of new Fab, Fab 16 depending on the future market situation. Powerchip also adjusts down the CAPEX of 2011 to NT$16B, 20% lower than NT$20B of 2010. Rexchip R2 expansion plans will be postponed as well. We expect DRAM price will drop more than 30% QoQ in 4Q10 and the price may bottom out in 1Q11 or 2Q11. DRAM vendors will be more cautious toward the CAPEX in 1H11 during downward trend. 

3Q10 Worldwide DRAM revenue ranking : Samsung grows its market share to 40%

In terms of the own brand revenue, Samsung revenue still dominate other DRAM vendors that 3Q10 revenue grows 21.9% while revenue contribution is from mid-20% DRAM output growth and slightly rising DRAM average price. Samsung’s DRAM market share is also sharply up to 40.4% in 3Q10 from 34.3% in 2Q10. Market share from Hynix slightly declines to 19.8% from 21.6% given merely 2% DRAM output by unsatisfactory yield rate on 46nm process and 9% decline for average DRAM price. Elpida 3Q10 revenue is down 9.4%QoQ in 3Q10 while market share also declined to 16.1% from 18.4% since 45nm technology migration is still in early stage and less contribution to output growth. Micron 3Q10 revenue shrinks 10% QoQ while market share is down to 12% from 13.8% as well because output was constrained during Inotera’ technology migration transition. 3Q10 DRAM output from Micron decreased 12% while average DRAM ASP slightly decline. 

As for Taiwanese vendors, Nanya recorded 5.2% revenue decline in 3Q10. Despite of the output decline from Inotera, overall sales bit growth increases 14% QoQ benefited from the 50nm migration and enhanced wafer-in productions. However, the DRAM ASP decline 15% and market share is down to 4.2% from 4.5%. Powerchip outperformed other Taiwanese DRAM vendors with US$275M of 3Q10 revenue, 12.9% QoQ growth compared with 2Q10. The good figures are attributed by increased 63nm portion as well as yield improvement. Although Winbond’s 3Q10 revenue declined 2.7% QoQ from revenue in 2Q10, yet we are cautiously optimistic toward Winbond since Winbond has gradually faded out from commodity DRAM market and less impact by declining DRAM price. (Figure-1).

Note:
Figure-1: For Samsung 3Q10 memory revenue(7.49 Trillion KRW), we approximately derived the resulted based on the assumption that DRAM revenue accounts 68% in memory sectors and 3Q10 average exchange rate is US$1 against KRW$1,170. We apply this estimation to other vendors by indicating DRAM sales accounts 77% for Hynix total revenue, 52% for Micron. 35% for PSC, 90% for ProMOS, 96% for Nanya and 63% for Winbond under the following exchange rate: US$1 against NT$31.87, US$1 against JPY$85.74. 

Market share of own brand DRAM revenue by country

Korean vendors’ market share reached 61.2% and remains leading status in DRAM industry. American and Japanese DRAM makers’ shares are recorded at 12.2% and 16.3% respectively, Market share from Taiwanese DRAM vendors slightly decline to 10.3%. (Figure-2)