DRAM manufacturers sales increase by 18 in the third quarter
Hardware

DRAM manufacturers’ sales increase by 18% in the third quarter – RAM will continue to rise in price

According to a study by TrendForce, the DRAM market experienced a significant upturn in the third quarter of 2023, with total revenue rising to $13.48 billion. This corresponds to an increase of 18 percent compared to the previous quarter.

    Image source: pixabay.com

Image source: pixabay.com

The significant increase in sales is due to the gradual recovery in demand, which is encouraging manufacturers to increase purchases. Looking ahead to the fourth quarter, DRAM vendors are committed to price increases as memory chip contract prices are expected to increase by approximately 13-18%. However, the recovery in demand will not be as strong as in previous peak seasons. Overall, despite demand for inventory, purchases in the server segment remain constrained due to high inventory levels from previous quarters, suggesting limited growth in DRAM shipments in the fourth quarter.

It is important to note that the three major RAM manufacturers reported sales growth in the third quarter. Samsung’s revenue rose 15.9% to $5.25 billion, driven by strong demand for high-capacity chips driven by artificial intelligence and the introduction of DDR5 1α chips. Among manufacturers, SK Hynix recorded the largest growth, reaching a value of 34.4% with sales of $4.626 billion. The company has significantly reduced the market share difference with Samsung to less than 5%. Micron’s revenue rose about 4.2% to $3.075 billion, despite a slight decline in ASP (average selling price) due to higher demand and supply volumes.

However, towards the end of the third quarter, Samsung accelerated production cuts, primarily targeting DDR4 products, while simultaneously increasing inventories. According to forecasts, the production reduction could increase to 30% in the fourth quarter, which will lead to a decrease in the amount of memory wafers produced. At the same time, taking into account a gradual recovery in demand, Samsung plans to increase production volumes of memory chips no earlier than the second quarter of 2024. SK hynix has benefited from growth in HBM and DDR5 memory shipments and expects wafer production volumes to increase slightly towards the end of this year, followed by stable quarterly growth next year in line with growing DDR5 market penetration.

Micron, which has previously cut production, currently has relatively good inventory levels. In the fourth quarter of 2023, the company has already begun to increase wafer production volumes, primarily focusing on advanced 1β process technology. According to some estimates, silicon wafer processing volumes will continue to grow slightly in 2024, with an emphasis on moving to more advanced manufacturing processes.

At the same time, in Taiwan, Nanya shipments increased to 17-19% due to orders from PC market customers and spot market dynamics. However, weak demand for the company’s core DDR3 and DDR4 memory products, as well as lower prices, limited revenue growth, which ultimately amounted to a modest $244 million. Winbond’s aggressive pricing strategy to expand its DDR3 business and develop new production capacity helped drive third-quarter shipment growth and revenue to $112 million.

    Image source: TrendForce

Image source: TrendForce

PSMC (Powerchip Semiconductor Manufacturing Corporation) generates its revenue primarily from consumer DRAM products, excluding photolithography wafer manufacturing services. There was a slight increase in demand thanks to rising spot prices, resulting in quarterly DRAM sales growth of 4.4%. However, if sales from photo chip production are taken into account, there was a decline of 5.5% in this quarter.

About the author

Dylan Harris

Dylan Harris is fascinated by tests and reviews of computer hardware.

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