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May 29, 2017

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DRAM makers report that April revenues see decline

TAIPEI, Taiwan -- DRAM makers Inotera Memories (華亞科) and Nanya Technology (南科) yesterday reported slight revenue declines in April, with sales tumbling by 7.5 percent and 2.24 percent month-on-month.

April revenues for Inotera declined by 7.5 percent to reach NT$6.462 billion but improved 87.6 percent year-on-year. Revenues in the first four months of this year grew by 120.96 percent year-on-year, reaching NT$26.686 billion. The company attributed the declines to a lower number of working days throughout April and the first quarter.

Nanya in April recorded revenue of NT$3.687 billion, a decline of 2.24 percent but an improvement of 23.4 percent year-on-year. In the first four this of this year, the company accumulated revenues of NT$15.378 billion, improving by 9.5 percent year-on-year. The company stated that a 3-percent slip in the average selling price of memory modules nullified expected gains of a 1-percent growth in shipping volume recorded in March. For May, the company is expecting memory prices to stabilize and hold at current levels. Supply for standard specification memory modules may be constrained throughout the sector as manufacturers transition toward making variants designed for mobile devices, the company added.

According to research institute TrendForce, the memory production sector is expected to benefit from anticipated growth in demand for PCs. The institute stated that global shipments of laptop computers may grow by 3.4 percent over the second quarter, with the top-eight PC makers expected to see unit sales growth exceeding 7.3 percent. In addition, the institute attributed the anticipated surge in PC sales to Microsoft's decision to cease support and updates for the aging Windows XP operating system.

The institute remarked that new horizons pursued by PC makers and OEM companies such as the Google-led Chromebook device may spark new sales prospects for the memory sector. The Chromebook is a laptop computer designed to offer a low-cost option for light computing tasks, and is suited for business and educational applications.

In addition, with the sector dominated by a short list of heavyweights, the institute stated that the market will no longer be contested through cutthroat price competition, as seen in the past. Currently, standard specification memory modules still yield the highest profit margins, a condition that will be furthered as limited production capacities are allocated toward memory modules for servers and mobile devices.

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