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Q1 DRAM revenue drops due to softer ASPs

Posted: 03 Jun 2011 ?? ?Print Version ?Bookmark and Share

Keywords:DRAM revenue? global DRAM market? Q1 DRAM sales?

A report released by IHS iSuppli has revealed that global DRAM revenue in the first quarter dropped 5.6 percent to $8.3 billion from the fourth quarter of 2010. The market research firm blamed weak pricing for the decline.

Sales of DRAM chips fell short of the expected $9 billion in sales for the quarter on the softer-than-expected average selling price (ASP) of $1.61 during the quarter, short of the projected $1.89, according to IHS. The DRAM ASP in the fourth quarter of 2010 was $1.97, according to the firm.

DRAM sales and ASPs declined compared to the first quarter of 2010, when they were $9.4 billion and $2.78, respectively, IHS reported.

"Buffeted by weak market conditions, companies across the DRAM space saw their revenues contract across the board in the first quarter of this year," said Mike Howard, principal analyst for DRAM and memory at IHS, in a statement. "For the top eight DRAM companiestogether responsible for 98.1 percent of the total industryrevenue in the first quarter this year fell for every single player, although the rankings held steady."

South Korea's Samsung Electronics Co. Ltd maintained its hold on the top spot in DRAM sales in the first quarter, accounting for 39.3 percent of the market despite a DRAM revenue decline to $3.3 billion from $3.6 billion in the fourth quarter of 2010, IHS said. Samsung's market share declined from 41.3 percent in the fourth quarter of 2010, IHS added.

DRAM market

Global DRAM Market Share (Ranking by Revenue in Billions of U.S. Dollars)

Despite losing two points of market share, Samsung's share of the DRAM market remained nearly double that of its closest competitor, fellow South Korean firm Hynix Semiconductor Inc., according to IHS. History points to Samsung being poised for a strong rebound after its first quarter sales decline. After Samsung's previous two sequential declines in revenuein the first quarter of 2007 and the fourth quarter of 2009the company experienced a period of robust growth, IHS said. The market research firm predicts that Samsung's next move will likely be another all-out grab for DRAM market share.

Samsung's slight loss of market share at the top redounded to the benefit of the four players that saw their share rise during the first quarter, even though each firm's revenue declined like everyone else, according to IHS.

Elpida Memory Inc. and Micron Technology Inc. are likely to swing back and forth battling for the No. 3 spot in DRAM in 2011, according to IHS. Neither appears ready to challenge Hynix for second place in the near future, the firm observed.

- Dylan McGrath
??EE Times

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