While the dynamic random access memory (DRAM) market endured a tough third quarter, several players outperformed the industry and saw their share of market revenue rise appreciably, especially South Korea’s Samsung Electronics Co. Ltd. and U.S.-based Micron Technology Inc., according to a new IHS iSuppli DRAM market brief from information and analysis provider IHS.
Overall, the Top 8 players accounted for 97.6 percent of the DRAM market in the third quarter—up very slightly from the 97.4 percent in the second quarter. Revenue within the elite circle, however, dipped to $6.6 billion, down 18.5 percent from $8.0 billion in the earlier quarter. Mirroring the decline of the Top 8, the industry as a whole also shed revenue by 15.8 percent to $6.8 billion due to extraordinarily weak pricing, down 23.0 percent for the period.
Despite the difficult quarter, there were two clear winners: Samsung and Micron.
Samsung, long the DRAM market leader, enlarged its share by 3.5 percentage points to garner an impressive 45.0 percent portion in the third quarter, corresponding to revenue of $3.1 billion out of the market’s total $6.8 billion. Samsung grew shipments 9 percent, while the drop in its average selling price (ASP) of nearly 17 percent was below the market’s pace of 26 percent. Considering that Samsung has grown its share steadily over time, and given that the electronics giant has the most generous capital expenditure budget, its success in this area is almost bound to continue unabated.
For its part, Micron saw its share of market increase to 12.1 percent, up from 10.6 percent, on revenue of $821 million—good enough for fourth place. Micron’s gain put it within a hair’s breadth of third-place Elpida Memory Inc. of Japan, which saw its share decline to 12.1 percent, down from 14.6 percent, on revenue of $823 million. Elpida shipments were up 16 percent in the third quarter, but its ASP plummeted a steep 39 percent. The rising yen also made the Elpida manufacturing facility in Japan look relatively expensive compared to production sites outside of Japan.
Like Elpida, second-place Hynix Semiconductor Inc. of South Korea suffered a loss of market in the third quarter. With revenue of $1.5 billion, Hynix had 21.5 percent share, down from $23.4 percent. The company’s ASP fell faster than the industry average, sinking 29 percent during the period.
Another loser was fifth-place Nanya Technology Corp. of Taiwan, down to 3.6 percent market share from 4.7 percent—a significant drop largely driven by the supplier’s relatively weak ASP, which fell 32 percent. Nanya shipment growth at 7 percent also was slightly lower than the industry average of 13 percent. Nanya continues to be heavily exposed to the commodity market and will find the next few quarters an uphill climb, especially as the commodity market is forecast to remain in a slightly oversupplied position.
Rounding out the Top 8 were Winbond Electronics Corp., one of the few gainers along with Samsung and Micron, in sixth place; ProMOS Technologies Inc., down to less than 1 percent share; in seventh place; and Powerchip Technology Corp., rebounding after not shipping any branded DRAM in the second quarter. All three companies are based in Taiwan.
No other manufacturer is likely to see its market share increase significantly in 2012, and the exit of a player—through either bankruptcy or consolidation—is very likely the only factor with the potential to redraw the DRAM landscape.
Learn More > Third-Quarter DRAM Market Shares: Micron Roars Back, Samsung Gets Closer to 50%