BUSINESS

Samsung, SK may benefit from booming chip market

By Shin Ji-hye
  • Published : Jun 18, 2017 - 15:08
  • Updated : Jun 18, 2017 - 18:18
South Korean chipmakers Samsung Electronics and SK hynix may benefit from the booming memory chip market driven by rising prices and tight supply, local reports said Sunday, quoting market research firms.

According to a June 15 report by DRAMeXchange, the average contract price of DRAM for servers will increase up to 8 percent in the third quarter from the previous quarter. The average price rose 40 percent in the first quarter and 10 percent in the second quarter from the previous quarters.

The continuing price growth is partly driven by rising demand for high-capacity memory in the server market, the report said.

“Going into the second half of 2017, the increase in the market penetration of (high-capacity) 32-gigabyte product lines are expected to be the main demand drivers,” said Mark Liu, an analyst from DRAMeXchange.

The proportion of the 32-gigabyte capacity option out of total server DRAM module shipments will surpass 60 percent by the end of 2017, the report said. 

Another market research firm IHS Markit said Friday the global memory market for both DRAM and NAND flash achieved record revenues in the first quarter and will continue to perform well later this year.

The global DRAM market posted $14.7 billion in sales and the NAND flash market recorded $11.7 billion in the first quarter, the firm said.

“The tight supply of NAND is continuing with the healthy demand from solid state drive -- a nonvolatile storage device that stores persistent data -- and mobile applications and the industry transition from planar to 3D NAND technology,” said Walter Coon, director at IHS Markit.

The firm predicted the memory market is expected to achieve another record in the second quarter due to tight supply of DRAM and NAND flash.

Samsung Electronics is the largest memory chipmaker in the world with a 43.5 percent share in DRAM and a 36.7 percent share in NAND flash, according to DRAMeXchange and IHS Markit.

SK hynix is the second-largest DRAM maker with a 27.9 percent share and the fourth-largest NAND flash provider with an 11.4 percent share.

By Shin Ji-hye (shinjh@heraldcorp.com)