SAN FRANCISCOThe DRAM industry is likely to continue to rebound in 2010, according to market research firm iSuppli Corp., which said sequential growth in DRAM revenue and pricing during the second and third quarters was the strongest the industry has seen in at least five years.
According to iSuppli's preliminary estimate, global DRAM revenue was up 35 percent in the third quarter compared to the second quarter, following a 34 percent sequential increase in the second quarter.
The second-quarter revenue increase brought to a close a three quarter losing stream that started in the third quarter of 2008, iSuppli said. Revenue had fallen by 19 percent in the first quarter of 2009, plunged by 38 percent in the fourth quarter of 2008 and decreased by a moderate 1 percent in the third quarter of 2008, according to the firm.
Global average selling prices (ASPs) for DRAM rose by 21 percent in the third quarter following a 19 percent increase in the second quarter, according to iSuppli. The second quarter marked the first sequential increase in DRAM pricing since the fourth quarter of 2006, the firm said.
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The global DRAM market has been declining on an annual basis since 2007, according to iSuppli. Revenue decreased by 7.5 percent in 2007 and 25.1 percent in 2008, according to the firm. Despite a strong recovery in the second and third quarters, weak conditions in the first quarter mean that global DRAM revenue is set to decline by 12.9 percent in 2009, according to iSuppli's preliminary estimate.
"Third-quarter earnings from Samsung, Micron and the Taiwanese DRAM manufacturers point to increasing sales and further progress toward profitability," said Mike Howard, iSuppli senior DRAM analyst, in a statement.
Howard noted that Samsung turned a profit in the third quarter and said Micron's results indicate that the company is on the way back to profitability. Meanwhile, the five Taiwanese DRAM suppliers collectively saw monthly revenues increase by 15 percent per month for the last three months, Howard said.
DRAM supply levels are expected to remain fairly consistent in the fourth quarter, iSuppli said. DRAM demand is expected to improve in 2010 in concert with the general global economic recovery, according to the firm
ISuppli is offering for sale a report on the DRAM market through the company's website.