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Citing the U.S. government’s JEDI contract as well as the increased need for telework due to the COVID-19 outbreak, the DRAMeXchange research division of TrendForce has now raised its previous forecast of 2Q20 server DRAM price trend from a 15% increase QoQ up to a 20% increase QoQ. The same uptrend is reflected in 2Q20 enterprise SSD prices as well, with the previous forecast of a 5-10% increase QoQ now corrected up to a 10-15% increase QoQ. In addition, memory suppliers are now facing low inventory levels, subsequently prompting them to maintain the 2Q20 price upsurge.
According to the DRAMeXchange research division of TrendForce, 4Q19 NAND flash bit shipment increased by nearly 10% QoQ thanks to demand growth from data center clients. On the supply side, contract prices made a successful rebound due to shortages caused by the power outage at Kioxia’s Yokkaichi production base in June. In sum, 4Q19 NAND flash revenue reached $12.5 billion, an 8.5% increase QoQ.
According to the DRAMeXchange research division of TrendForce, the DRAM inventory finally returned to a relatively normal level for most OEMs in 4Q19 after nearly three consecutive quarters of adjustments. As the growth in the industry’s overall DRAM supply will be fairly limited in 2020, buyers have been raising procurement ahead of time. Therefore, despite the relatively strong base period in 3Q19, DRAM suppliers increased their sales bits in 4Q19. This increase was able to largely offset the declines in their quotes. All in all, 4Q19 global DRAM revenue registered a minor decrease of 1.5% QoQ, showing a relatively flat trend compared to the previous quarter.
The following analysis shows TrendForce’s investigations of key component and other downstream technology industries, under the impact of the COVID-19 outbreak, with the latest data as of February 14, 2020.
The server industry analysis by the DRAMeXchange research division of TrendForce thus far finds that frontline personnel of Chinese server manufacturers will return to work starting from 2/10, while other personnel resumed work on 2/3. Certain Chinese manufacturers resumed operations on 2/3 with government approval. On the whole, the server supply chain recovery has been progressing better than expected. Server manufacturers have traditionally increased capacity and stocked key components up to one month before the Chinese New Year to facilitate smooth shipment after the holidays. As such, major ODMs believe that the coronavirus outbreak will have minimal impact on server shipment in the short term despite the delay in work resumption. If work resumption on 2/10 cannot properly proceed, ODMs will increase their future production correspondingly.
