14 DAY TRIAL // With the slow passing on of the economic recession, the IT industry, as is the case with all other facets of the global economy, has begun to recover. However, it seems that the recovery rate won't be as fast as hoped for, at least as far as memory makers are concerned. While DRAM prices have dropped and sales are generally expected to rise, market reports delivered by Digitimes suggest that the overall revenues will stay flat for the ongoing month and will even drop slightly for the entire quarter.
Among the companies whose revenues are expected to stay flat are Transcend Information, I-O Data Technology and Phison Electronics. Recently, downward price corrections for DDR2 memory have led to price drops for DDR3 modules as well. According to DRAMeXchange, 1Gb DDR3 recently sold for less than $3 and even continued to drop by January 27, to as low as $2.89.
In parallel, average prices of branded and effectively tested (eTT) 1Gb DDR2 fell 0.9% and 1.3% in a single day, reaching $2.32 and $2.15, respectively. However, given that DDR3 are still in limited supply, the price is not expected to fall much lower. On the other hand, NAND flash prices are becoming stable and may be the means by which module manufacturers will make up for the losses in the DRAM sector.
I-O Data is an example of a company whose NAND sales are already outpacing its DRAM shipments. As such, its revenues will likely be similar to those of December. Transcend has also been focusing more on NAND, which will likely have a similar revenue-preserving effect. In contrast, Phison Electronics seems set to even grow by quite a bit during the ongoing month, also thanks to its NAND marketing performance. Actual estimates point towards Phison reaching NT$2.6 billion (US$81 million), a significant increase compared with the NT$2.3 billion from December 2009.
Overall revenues for the entire quarter are expected to drop slightly, mainly due to the lower number of working days in February.