DRAM Revenue to Grow by Over 30%

When reading the title, some people may feel doubtful: the major contributor of PC is still giving bad results, how DRAM industry to see growth, even an increase of at least 30%. However, it is true. In addition, more surprising, price of DRAM is expected to stabilize this year after multiple years of double-digit drops ; even the overall DRAM bit demand to rise as well.

 

Despite the continuous weak performance of traditional PC market, DRAM industry will maintain revival. In order to face the beat of the rapid growth of cloud computing services and the popularity of mobile products, DRAM vendors have started the structural changes and transitions. In fact, since the second half of last year, DRAM market has shown improvement as suppliers reduced and turned to mobile field.

 

Trendforce said “DRAM vendors have begun to not only initiate various merging and restructuring processes, but are also intensifying the efforts to switch to the more profitable product lines. As the diversification among the DRAM products grows, the differences in the profits experienced by manufacturers are expected to become more and more apparent.”

 

Since the prosperity of mobile devices becomes an inevitable trend, DRAM manufacturers also peg hope on this segment, developing mobile DRAM. Digitimes pointed out mobile devices, such as smartphones and tablets, will spur an almost 30% increase in overall DRAM bit demand in 2013, comparing with 2.9% growth brought by desktop PCs and notebooks.

 

“Mobile DRAM demand is forecast to register a 72.9% jump in 2013, buoyed by the expanding markets for smartphones and tablets,” said Nobunaga Chai, analyst for semiconductors at Digitimes Research.

 

He also predicted the average DRAM content in smartphones will expand to 0.9-gigabyte (GB) in 2013 from 0.7GB in 2012, while that in tablet is set to reach 1.3GB in 2013 compared to 1.1GB in 2012.

 

As for DRAM price, this segment is set to see good news as well. Due to the serious oversupply, the prices for DRAM experienced multiple years of double-digit drops. But in 2013, the situation will change as demand exceeds supply and the number of memory makers dwindles. In January 2013, the average selling price for DRAM has surged by 13% quarterly.

 

"The DRAM market is extremely volatile. If it just gets a little bit where there is more demand than supply, then prices skyrocket,” said Brian Matas, vice president for market research at IC Insights.

 

IC Insights is expecting an average DRAM selling price this year of US$1.85 per unit, though prices typically vary on the capacity and memory type; and DRAM sales this year to reach $30.7 billion with shipments of 16.6 billion units.