Hynix, Micron and Intel deliver flashy performances in Q3 NAND Flash market
(Business News, 07 Dec 2007 )
Amid strong growth in global NAND Flash memory sales in the third quarter, Hynix Semiconductor Inc., Micron Technology Inc. and Intel Corp. impressively outperformed the competition, according to a preliminary ranking from iSuppli Corp.
Hynix of South Korea achieved the strongest growth on a sequential basis, with its global NAND Flash revenue rising to $806 million in the third quarter, up a whopping 79.1 percent from $450 million in the second quarter. It was followed by Micron of the United States, whose NAND revenue jumped by 75.5 percent to reach $285.4 million, up from $162.6 million in the second quarter.
Intel was third, with its NAND revenue rising by 47.9 percent to reach $132 million, up from $89.3 million in the second quarter. However, the U.S. semiconductor giant performed much better on a year-to-year basis, with its revenue rising by an industry-leading 222 percent compared to the third quarter of 2006.
“Hynix’s big sequential jump in NAND revenue was due to its stunning unit shipment growth of 92 percent compared to the second quarter,” said Nam Hyung Kim, director and chief analyst, memory ICs/storage systems for iSuppli. “Meanwhile, Micron’s and Intel’s explosive growth was due to the companies ramping up production at their NAND manufacturing joint venture: IM Flash Technologies LLC (IMFT).”
Samsung’s share shrinks Leading NAND Flash supplier Samsung Electronics Co Ltd. of South Korea fell short of the industry’s average growth rate in the third quarter, causing its market share to decline. Samsung’s NAND revenue amounted to $1.7 billion in the third quarter, up 21.2 percent from $1.4 billion in the second quarter. Thus, Samsung’s NAND market share declined to 40.2 percent, down from 45.4 percent in the second quarter.
Samsung’s actual bit growth reached only 4 percent during the third quarter, missing its guideline for a low double-digit rise, which was issued at the company’s second-quarter investor call.
Toshiba maintained its market share of 27.2 percent in the third quarter. The top-three suppliers dominated the market with a combined 87 percent market share during the quarter.
Hot flash The NAND Flash market enjoyed strong demand growth in the third quarter, contrasting markedly with the weak performance in the DRAM segment. Global NAND Flash revenue in the third quarter rose to $4.2 billion, up 37 percent from $3 billion during the same period in 2006. This was very close to iSuppli’s forecast of $4.16 billion in revenue in the third quarter.
Megabyte unit shipments rose by 31 percent, while the per-megabyte Average Selling Price (ASP) increased by 5 percent compared to the second quarter. This marked the second consecutive quarter of price increases for NAND Flash.
In contrast, global DRAM revenue decreased by 14 percent in the third quarter compared to the same period in 2006.
“The NAND market in the third quarter enjoyed a combination of strong seasonal consumer–electronics demand from products including Apple’s iPod line and high supply growth,” Kim said.
Flash in the pan However, the NAND market’s growth streak is coming to an end in the fourth quarter. iSuppli expects the NAND Flash megabyte ASP to decline by 18 percent this quarter while megabyte unit shipments will increase by 37 percent.
The two quarter consecutive price surges will turn into consecutive price drops in the fourth quarter and in the first quarter of 2008 due to increased production capacity, which will increase availability and drive down pricing. With iSuppli recently having downgraded its rating of near-term market conditions for NAND makers to “negative” this month, suppliers need to be wary of declining prices during the slow periods of the year: the fourth and first quarters.
