© carabiner dreamstime.com Analysis | September 30, 2013
Mobile DRAM posts improved revenue in Q2
The market for mobile dynamic random access memory (DRAM) grew in the second quarter in light of anticipated demand for the upcoming hot selling season.
Revenue for mobile DRAM reached $2.8 billion during the April through June period, up 26 percent from $2.2 billion in the first quarter, according to a new DRAM Dynamics Brief from IHS Inc. (NYSE: IHS), a leading source of global information and insight. Growth was driven by a 24.1 percent increase in mobile DRAM bit shipments as well as by a 1.5 percent uptick in average selling prices (ASP). In comparison, mobile DRAM revenue in the first quarter fell by 14 percent sequentially, shipments rose just 1.5 percent while ASPs plummeted 15.2 percent. Despite the latest gains by mobile DRAM, its share of the DRAM market as a whole rose by just a sliver. Mobile DRAM in the second quarter commanded 33 percent of the total DRAM market, marginally up from 32 percent in the first quarter. The most recent share portion was less than the 34 percent share enjoyed in the third quarter of 2012, or the 39 percent share posted during the fourth quarter last year. “Share of mobile DRAM remained below the levels reached in the second half last year because of seasonally slow demand during the most recent period for smartphones and tablets,” said Mike Howard, senior principal analyst, DRAM & Memory, for IHS. “In this respect, commodity PC DRAM continues to account for the majority of the DRAM space with the rest of the DRAM market represented by other segments, such as server DRAM, consumer DRAM and graphics DRAM.” ASP ascension Still, the ASP increase of mobile DRAM in the second quarter was not a trivial matter, even at less than 2 percent. The increase, in fact, was a departure from at least nine consecutive quarters of pricing declines. Had mobile DRAM prices climbed in the first quarter, the overall DRAM market would have performed much better. And a DRAM market in which both commodity and mobile prices were going up could have seen total DRAM revenue surpassing $10 billion per quarter. The forecast demand for smartphones and tablets in the second half of this year should result in continued growth of the mobile DRAM market, IHS believes. With new smartphone and tablet launches expected soon, mobile DRAM demand is expected to heat up as well. Market shares remain static South Korea maintained its dominance of the mobile DRAM industry, controlling nearly 75 percent of revenue thanks to the two largest players in the business, Samsung and SK Hynix. Samsung’s share in the second quarter fell 2 percentage points to 49.6 percent, but the electronics giant still has twice the market share of nearest competitor SK Hynix. Samsung’s mobile DRAM sales during the period reached $1.4 billion, up 21 percent from the first quarter. Meanwhile, SK Hynix made a substantial leap of its own, growing mobile DRAM revenue by 40 percent and nearly doubling its takings compared to the same time a year ago. In all, SK Hynix controlled 24.8 percent of the market. At No. 3 was Elpida Memory of Japan, which has been acquired by fourth-ranked Micron Technology of Idaho. In this case, the acquired performed much better than the buyer for the period: Elpida revenue jumped 80.0 percent from year-ago levels, while Micron underperformed the market with revenue growth of only 17.6 percent. If revenue from the merged entities was combined, the Elpida-Micron total would fall just shy of that claimed by second place SK Hynix. Separately, Elpida had 20.5 percent market share, while Micron was a distant fourth with just 3.9 percent. The remaining 1.2 percent of the market belonged to a motley group of suppliers, mostly manufacturers based in Taiwan.
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