Nanya, a maker of dynamic random access memory (DRAM) used in personal computers, climbed back into the black after a second-quarter loss as DRAM prices began a modest recovery thanks to seasonal demand and slowing supply growth.

"In the fourth quarter, we think the PC market is still reasonable, about 10 percent quarter-on-quarter growth. The seasonal market is still there," Nanya Vice President Pai Pei-lin told reporters.

Sector leaders, such as South Korea's Samsung Electronics Co. Ltd , have put most of their new production lines on making flash memory for mobile devices like digital cameras and MP3 players, keeping a lid on DRAM supply and boosting prices.

Nanya said July-September net profit reached T$2.01 billion ($60 million), down from T$2.16 billion in the year-earlier period but improving on a T$972 million loss in the second quarter.

Inotera accounted for T$600 million of Nanya's T$818 million in non-operating income, the company said.

The results beat market expectations. Twelve analysts surveyed by Reuters Estimates gave a median forecast of T$1.28 billion for Nanya's third-quarter net profit.

Nanya's chief domestic competitor, Powerchip Semiconductor Corp , said on Monday its quarterly profit had fallen by two-thirds from a year earlier to T$2.27 billion, though it was up from T$851.6 million in the second quarter.

On Friday Samsung posted a 30 percent drop in third-quarter profit from a year before, though buoyant demand for flash memory helped to support its bottom line.

Pai said Nanya will increase its output in terms of bits of data by 10 percent in the fourth quarter from the third. Third-quarter output rose 27 percent from the second quarter, exceeding the 20 percent growth Nanya had forecast.

Analysts said they expect DRAM prices to remain flat at best in the fourth quarter, as a seasonal pre-Christmas boom in electronics demand drew to a close