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keyword:Ken Kuo14 result(s)

Press Releases
TrendForce Reports DRAM Industry’s Q1 Global Revenue Fell by 7.5% Due To Weakening Contract Prices

2015/05/11

Semiconductors

The global DRAM revenue fell by 75% QoQ in 1Q15, with revenue totaling $12 billion, according to DRAMeXchange, a division of TrendForce The decline in the industry’s revenue is the result of the 11% quarterly decrease of the average DRAM contract price and the seasonality effects in the notebook and smartphone markets  Ken Kuo, assistant vice president of DRAMeXchange, said though DRAM makers experienced seasonal revenue decline in Q1, their margins did not shrink significantly as they made advances in process technology migration This quarter’s margins were therefore roughly the same as its previous quarter’s However, the effects of weak demand will have on DRAM price trend raises some concerns How well the DRAM makers have done on technology migration and adjusting product mixes will be critical for their successful performances this year DRAMeXchange forecasts the DRAM industry will be worth US$512 billion in 2015, an increase of nearly 12% YoY  Looking at the Q1 market shares of DRAM brands, Samsung and SK Hynix respectively took 43% and 27% of the market, giving the combined Korean suppliers over 70% of the global DRAM market The market share of the US-based DRAM maker Micron was 225%, a slight decline compared with the previous quarter These figures are unlikely to change much under the current oligopoly structure unless there are new market entrants (for example, China manages to create new rivals with its aggressive semiconductor policy)  As for manufacturing technology, Samsung remains the industry leader as its 20nm yield is stable and expected to account for nearly 60% of the supplier’s total output by the end of the year SK Hynix’s performance is boosted by its 25nm process The cost reduction that came with the technology migration offset the effects of declining prices, thus giving SK Hynix a healthy profit for this quarter Micron’s Q1 revenue suffered a big 13% quarterly drop Micron’s migration to the 20nm process has not progressed as expected, and a significant portion of the DRAM maker’s output still comes from the 30nm process Micron will need to speed up the transition to the 20nm process as to prevent declining market prices from affecting its profits any further, according to Kuo   With regard to Taiwan-based memory suppliers, Nanya is making a rapid migration from the conventional 30nm process to the 30nm-shrink process, which is expected to account for 50% of the total production by the end of the year Nanya’s revenue will stabilize as the manufacturing costs are reduced On the migration to 20nm, Nanya has scheduled next year for mass production Affected by weak commodity DRAM prices, Powerchip’s Q1 revenue fell by 79% QoQ However, Powerchip has already begun trial production on the 25nm process, and mass production will begin at the end of the year at the earliest Winbond has no commodity DRAM output, focusing instead on specialty and mobile DRAM With capacity fully loaded at 44K wafers per month, Winbond’s Q1 revenue only decreased by 13% QoQ   

Press Releases
TrendForce: DRAM Players Stay Profitable With Overall Revenue to Rise 16% YoY in 2015

2014/12/05

Semiconductors

2014 has been a fruitful year for the DRAM industry Tier-one manufacturers, benefiting from the global smartphone boom, have all stepped up mobile memory production According to DRAMeXchange, a research division of TrendForce, mobile memory will account for 36 percent of overall DRAM production this year and is very likely to surpass 40 percent of production in 2015  “Because of high demand for mobile memory, DRAM manufacturers have somewhat reduced standard memory production, keeping module prices high,” said Ken Kuo, Assistant Vice President at DRAMeXchange This year, the 4GB module has been selling for about US$32 while the average margin for standard memory has been above 40 percent, Kuo said, adding: “All DRAM manufacturers are staying profitable The increasingly oligopolistic nature of the market and changes in market demand will stable the development of the industry in 2015”  The 5 key trends to follow in the DRAM industry in 2015:  (1) Overall DRAM industry revenue will grow 16 percent year-on-year Growth will be slower than in 2014 while manufacturers will remain very profit oriented  The DRAM industry has become oligopolistic and the remaining top 3 DRAM makers will all focus on sustaining profits first and carefully adjusting production and product types Resilient global demand for smartphones will compel manufacturers to prioritize the production of mobile memory, squeezing standard memory production and pushing up standard memory prices “Commodity memory has become a cash cow for DRAM manufacturers,” Kuo said DRAMeXchange forecasts that the total revenue of the DRAM industry in 2015 will reach US$541 billion while annual growth will be 16 percent “2015 should be a year of stable growth and profitability for the DRAM industry,” Kuo added  (2) Samsung and SK Hynix both have new plants in place and will adjust production capacity according to market demand  Samsung and SK Hynix both announced plans to build new plants in 2014 amid rumors of increasing competition between the two DRAM giants In fact, while Samsung was expanding Line17, its Line16 was gradually returning production capacity from DRAM to NAND Flash at the same time Meanwhile, SK Hynix planned to use its M14 for small-scale production in the fourth quarter of 2015, while larger-scale production is slated for 2016 Overall, market demand for DRAM is still growing and production facilities are ready As a result, as long as wafer production goes as planned and technology processes evolve, DRAM manufacturers will be able to maintain current levels of profitability, despite prices falling on a quarterly basis  (3) Mobile memory becomes the global mainstream standard and LPDDR4 will be seen in vendors’ flagship smartphone models next year  In 2014, as smartphones became more affordable and packed with features, smartphone shipments increased and consumers in emerging markets began to regularly upgrade their handsets  “As the global smartphone market grows, mobile memory is occupying an increasingly large share of the memory market: 40 percent compared to the 27 percent that standard memory has,” Kuo said “Mobile memory is becoming a mainstream DRAM product” At the same time, from the standpoint of mobile memory, the mainstream standard will still be LPDDR3, which accounts for more than 60 percent of production in 2015, Kuo said, adding:  LPDDR4 will be seen in flagship smartphones in 2015 It is superior to LPDDR3 in terms of power saving and speed It is expected to have a 15 percent market share out of total Mobile DRAM capacity in third quarter of 2015  (4) DRAM players to compete on 20nm migration; increasing capital expenditure a barrier  Samsung and SK Hynix’s 25nm process technologies became mature in the second half of 2014 Regardless of the yield rate or wafer volume, both of the South Korean manufacturers’ chips became mainstream in the DRAM industry  Regarding 20nm process technology, Samsung has moved to the testing stage and SK Hynix’s product is expected to enter the market in the second quarter of 2015 By comparison, Micron only plans to use the 20nm process technology standard in memory storage produced by Inotera Micron’s improvement rate is lower than that of the two large South Korean companies as its entry into the sector was later, but is still targeting 80K wafer start capacity by the end of 2015 Since more equipment is necessary for the 20nm production process, requiring greater capital expenditure, the rate at which the 20nm migration takes place is expected to slow  (5) DDR4 technology will enter the server field first and could surpass 50 percent market share by the end of 2015  Under Intel’s leadership, DRAM manufacturers cooperated to make DDR4 technology enter the server field first “Server DRAM needs to be fast and stable, with low voltage,” Kuo said “In accordance with JEDEC regulations, DDR4 electricity is only 12V and the speed is expected to reach 3200 Mhz Meanwhile, the price gap between DDR4 and server-based DDR3 is shrinking DRAMeXchange projects that DDR4 memory will officially become mainstream in the server market as early as the end of 2015

Press Releases
TrendForce: China Consumes US$10.2 Billion and US$6.3 Billion Worth of DRAM and NAND Flash Chips in 2014

2014/11/14

Semiconductors

China's GDP showed tremendous growth over the years thanks to the country's positive market developments and economic policies The business potential of the country's massive consumer market also grew as PC, smartphone, and tablet manufacturers began setting their sights on the country As of this year, nearly 4789 billion DRAM chips and 3518 billion NAND Flash chips from the 2Gb category have been consumed in the China market, accounting for a respective 192% and 206% of the world's total DRAM and NAND Flash output, according to the latest report from DRAMeXchange, a research division of Taiwan-based market intelligence firm TrendForce  China's PC DRAM consumption is currently at approximately 15% Benefiting from domestic demand, Lenovo has managed to raise the scale of its business operations over the years, and is currently acquiring other companies as a means to boost its presence among first tier manufacturers While the company is still competing fiercely with HP for top position in the PC market, its overall PC shipments are already ahead of all of its other competitors' For 2015, DRAMeXchange predicts that Lenovo's market share will arrive at approximately 17% As has been the case with the other markets, Mobile DRAM is expected to gradually replace PC DRAM as the mainstream in China given the country's growing smartphone and tablet sales Aside from ZTE and Huawei, which are doing relatively well overseas, most China-based smartphone brands are expected to place their focus on the domestic market Based on TrendForce's 2014 market statistics, China alone already accounts for 28% of Mobile DRAM's overall bit demand The importance of China's economic development to the entire DRAM industry is expected to become more apparent next year as that proportion rises to over 40%  As the NAND Flash manufacturing processes are currently advancing to under 1ynm, many NAND Flash applications including smartphone and tablet-based eMMCs and Notebook-based SSDs are showing improved growth in the market Competition among global OEM manufacturers, meanwhile, is starting to become more intense, with brands other than Apple and Samsung starting to make their way into the country's lucrative market The level of China's NAND Flash consumption has managed to grow considerably over recent years due to Lenovo's rise to prominence, the above-average growth shown by China's emerging brands, and the improving standards of China's hardware designs By the end of 2014, DRAMeXchange projects that the NAND Flash market's total value in China will reach up to US$ 63 billion The proportion of China's overall NAND Flash usage relative to the world's NAND Flash output, on the other hand, is expected to hit 206% in 2014, and 30% or more in 2015  China to implement a series of key policies to sustain domestic growth  China's efforts over the years to transform from a manufacturing-based to consumption-based economy has been largely successful Given the consistent growth in its economy and the country's rising wage levels, many of the productions in China are bound to be outsourced to other emerging countries The Chinese government's current goal is to improve the country's outlook by implementing strategic policies that are aimed at enhancing its industrial capabilities One such policy involves increasing the imports of semiconductor components such as smartphone CPU, AP, DRAM, and NAND Flash, the combined value of which exceeds the value of China's imports for oil In the future, it would be interesting to see whether UNIS’s (Unisplendour Corporation Limited) efforts to integrate resources from Spreadtrum Communications, RDA, and Intel will be successful  Due to the relatively high proportion of CPU, DRAM, and NAND Flash components imported by China, the government policies that are implemented with regard to these three product categories may prove critical to the country’s industries A few days ago, the Chinese government announced a policy worth NT$600 billion that involves mastering the technologies at the upper streams of the country's semiconductor supply chain and applying these technologies to mid to lower streams The main purpose behind this is to enable the country's supply chains to be more integrated and to allow momentum in China’s domestic industries to persist   

Press Releases
Trendforce: Global DRAM Industry Value Increases 11% in Third Quarter

2014/11/12

Semiconductors

Samsung, SK Hynix and Micron, the world’s top three global memory manufacturers, boosted production capacity in the third quarter to meet Apple’s immense demand for mobile memory as it launched the iPhone 6, according to DRAMeXchange, a division of the Taiwan-based market intelligence firm TrendForce The reduction in commodity DRAM production caused contract prices to rise, and commodity memory products had the highest margins in the third quarter As a result, DRAM industry value reached US$12 billion, an 11% increase over the second quarter and a new quarterly revenue record  As memory makers’ production ratios are well adjusted and they continue to increase next-generation output, their profitability is expected to see further improvement Samsung leads with an operating margin of 42%, while SK Hynix is close behind at 40% Micron, still using the 30nm process as its main technology, has a gross margin of 241% However, given the DRAM oligopoly, profits are expected to remain stable and DRAM industry value is projected to reach US$471 billion for 2014 Although quarterly decline is forecast for average selling price in 2015, as bit output continues to increase, DRAM industry value is expected to do so as well  DRAM Manufacturer Highlights  The yield rate for Samsung’s 25nm process reached 85% in the third quarter, resulting in 184% quarterly revenue growth As next-generation technology is reducing manufacturing costs, Samsung’s third-quarter operating margin was 42%, the highest of the major memory makers  SK Hynix also made a breakthrough on yield rate and rapidly advanced to the 25nm process, but due to output losses from the initial stages of migration, revenue only increased by 7% over the prevous quarter However, SK Hynix’s revenue is expected to increase significantly in the fourth quarter as production picks up  As for Micron, since the company’s strategy focuses on mobile and server memory as opposed to commodity products, commodity DRAM revenue was not as high as that of the Korean makers Still, that revenue grew 47% on a quarterly basis Micron is manufacturing mainly on the 30nm and 25nm processes, with test production to begin on the 20nm process at the end of the year If all goes well, Micron should have 80K wafers per month dedicated to 20nm production by the end of 2015, which would certainly help the manufacturer catch up to its competitors  Although Inotera is now a subsidiary of Micron, due to Micron’s price negotiation structure, Inotera had the highest operating margins of all DRAM makers, 519% - a slight decline over the second quarter Inotera’s capital expenditure for next year is set at NT$500 billion, which will be spent on acquiring the same equipment as the Hiroshima fab for successful migration to the 20nm process  Among Taiwanese memory makers, Nanya is focusing on the production of specialty memory and working with other manufacturers to produce commodity and mobile products Nanya performed well in the third quarter Revenue grew 102% over the quarter to June and operating margins were 416%  Winbond continues to see growth in specialty DRAM and low-density mobile DRAM sales, with a 57% quarterly revenue increase and 122% operating margins in the third quarter Winbond has increased capacity to 40K wafers per month this year and is expected to aim for 44K wafers per month in 2015  Powerchip’s DRAM revenue fell by 5% in the quarter to September, mainly due to a decline in foundry service prices The memory maker is expected to expand capacity at its P3 fabrication plant next year, which will increase both production capacity and profits   

Press Releases
TrendForce: Global DRAM industry value reaches US$10.8 billion, an increase of 9% in 2Q14

2014/08/11

Semiconductors

For the entire 2Q14, global DRAM industry value reached US$108 billion, an increase of 9% compared to the previous quarter, according to DRAMeXchange, the memory and storage research division of TrendForce The impressive scale of the industry’s value, along with the market's improved profitability, are the result of the DRAM manufacturers' effective product mix adjustments Of the three major DRAM suppliers, Samsung had the most impressive 2Q14 performance with an operating margin of 39% SK Hynix trailed close behind its Korean rival with a 38% operating margin Inotera, a subsidiary of Micron, ended up with the industry’s largest operating margin at 546% In the second quarter, Samsung's and SK Hynix's market shares were 39% and 27%, respectively Considering how the Korean manufacturers represent almost 70% of the entire DRAM market, their influences in the industry should not be underestimated US based Micron, also a key player with influence over the market’s pricing movements, ended up with approximately 26% of the market by the end of 2Q14 With the DRAM industry's oligopoly structure becoming more apparent and supply continuously tightening, price drops have become relatively uncommon in the market The DRAM industry value for 2014, as such, is projected to grow by an estimated 36% YoY to US$468 billion  Production Technology Analysis of DRAM Vendors  Samsung again showed progress with its production technologies as its 25nm yield rate improved to 85% in the second quarter Thanks to enhanced output growth and the continuously rising contract prices, Samsung’s 2Q14 revenues were able to grow by an estimated 20% compared to the last quarter The Korean company's 2Q14 operating margins, meanwhile, benefited from lowered manufacturing costs, and reached up to 39%- the highest among the major DRAM manufacturers  SK Hynix, even though the company's Wuxi plant officially resumed its operations during the first quarter of this year, its revenues for the entire second quarter were up by only 6% due to limited production yields However, following continued advancements in its 25nm wafer production technology, its revenues and operating margin, which reached close to 38% in 2Q14, have a chance of showing further improvements in the coming periods  Micron’s Singapore Tech plant has officially made a transition towards NAND flash products during the second quarter of this year and took steps to reduce its total wafer output, with 2Q14 DRAM revenues saw slightly declining 2% Its operating margins ended up at approximately 255%, up slightly from the previous quarter thanks to its continuous efforts to transition towards 25nm technology Micron currently still relies on the 30nm process for the most part when manufacturing memory products With the developments for its 25nm technology continuing and the testing and mass production phase for its 20nm process scheduled to begin in 4Q14 and 1H15, respectively, the US company could effectively shorten the technological gap between itself and the aforementioned Korean companies as early as 2015  Inotera’s performance was the most noteworthy among the DRAM manufacturers thanks to its effective pricing structure and attention to profitable product lines Not only did the Taiwanese company's operating margins reach 55% by the end of the second quarter, but its leading position with the 20nm manufacturing process also puts it ahead of its Taiwanese competitors  Nanya is currently focusing on producing specialty DRAM as well as working with special module plants on the production of its PC DRAM components In the second quarter of this year, the company's performance turned out to be relatively stable, with revenues rising by an estimated 25% QoQ and operating margins reaching 36%  Winbond, as before, is continuing to see improvements in the sales of its specialty DRAM and small density Mobile DRAM components, and experienced an impressive 105% QoQ growth in its overall revenues Other than raising its capital expenditure and increasing its wafer output to 40K this year, the company will continue to develop its 46nm manufacturing process With its manufacturing cost lowered, its 2Q14 operating margins rose to approximately 93%  Powerchip's 2Q14 DRAM revenues were equally noteworthy, rising by approximately 20% from the previous quarter thanks to the growth of the company's foundry business as well as its raised PC DRAM output As its P3 plant currently still has room for growth, the company is likely to consider a major expansion for its existing wafer production capacity     

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