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Memory sales surprisingly strong during virus pandamic


Thursday, April 30, 2020

Memory contract prices have continued their rallies in the second quarter of 2020 despite the coronavirus outbreak, which has prompted market research firms to downgrade their global IC market outlook this year to negative growth.

DRAM and NAND flash prices have been rising despite the virus hitting hard demand for smartphones and other consumer electronics devices.

Growth in memory supply particularly of NAND flash chips has been constrained since 2019, as major chipmakers intend to control their output for profit reasons and focus more on technology transitions. The global NAND flash industry output is expected to stay low in 2020 to avoid a repeat of the oversupply seen last year, the sources indicated.

Gartner, which has cut its global semiconductor market growth forecast this year to a slight 0.9% decrease, said in its April report that growth in the memory segment "could prevent a steep decline." Gartner forecasts the memory market will climb 13.9% in 2020. Within the memory sector, NAND flash revenue is forecast to grow 40% due to severe shortages persisting from 2019, which keeps pricing firm, according to the research firm.

The coronavirus pandemic will be dragging down the non-memory semiconductor market segments in 2020, however. Without the pandemic, the non-memory sector could outperform the memory segment in terms of growth this year, some market observers believe.

IC Insights has twice revised downward its semiconductor market outlook for 2020. The research firm now expects the market to drop 4% compared to the previously-estimated 3% growth.

Despite growing coronavirus-induced uncertainties facing the memory sector, major suppliers continue their next-generation technology and product development as well as plans for future capacity expansions.

Samsung Electronics has reportedly entered the final stage of its 192-layer NAND chip development. The industry leader has kicked off volume production of 128-layer 512Gb TLC 3D NAND chips since November 2019.

Samsung is also constructing a new facility at its factory site in Xian, China with the construction set to complete in the second half of 2021, according to industry sources. The new fab designed for 128-layer and more advanced memory chips will bring in an additional output of 130,000 wafers monthly.

SK Hynix has rolled out 128-layer 1Tb TLC 4D NAND for SSDs, and is developing its next-generation 176-layer 4D NAND flash, according to the company. SK Hynix is also constructing a new fab, M16, in Icheon for future demand.

By: DocMemory
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