El Segundo, Calif. The global NAND flash market enjoyed strong growth in the third quarter, with revenue of $4.2 billion, up 37 percent from $3 billion during the same period in 2006, driven by strong seasonal consumer electronics demand, according to market research company iSuppli Corporation.
Megabyte unit shipments rose by 31 percent, while the per-megabyte average selling price (ASP) increased by 5 percent compared to the second quarter. This marked the second consecutive quarter of price increases for NAND flash. But there is good news ahead for NAND flash buyers. iSuppli expects the NAND flash megabyte ASP to decline by 18 percent this quarter while megabyte unit shipments will increase by 37 percent.
The two quarter consecutive price surges will turn into consecutive price drops in the fourth quarter and in the first quarter of 2008 due to increased production capacity, which will increase availability and drive down pricing, said iSuppli. With iSuppli recently having downgraded its rating of near-term market conditions for NAND makers to "negative" this month, suppliers need to watch declining prices during the slow periods of the year: the fourth and first quarters.
Amid strong growth in global NAND flash memory sales in the third quarter, Hynix Semiconductor Inc., Micron Technology Inc. and Intel Corp. outperformed their competitors, according to a preliminary iSuppli ranking.
Hynix of South Korea achieved the strongest growth on a sequential basis, with its global NAND flash revenue increasing to $806 million in the third quarter, up 79.1 percent from $450 million in the second quarter. It was followed by Micron in the United States, whose NAND revenue rose by 75.5 percent to reach $285.4 million, up from $162.6 million in the second quarter.
Intel was third, with its NAND revenue rising by 47.9 percent to reach $132 million, up from $89.3 million in the second quarter. However, the U.S. semiconductor giant performed much better on a year-to-year basis, with its revenue rising by an industry-leading 222 percent compared to the third quarter of 2006, said iSuppli.
Leading NAND flash supplier Samsung Electronics Co Ltd. of South Korea fell short of the industry's average growth rate in the third quarter, causing its market share to decline. Samsung's NAND revenue totaled $1.7 billion in the third quarter, up 21.2 percent from $1.4 billion in the second quarter, resulting in a market share decline of 40.2 percent, down from 45.4 percent in the second quarter.
Toshiba maintained its market share of 27.2 percent in the third quarter. The top three suppliers dominated the market with a combined 87 percent market share during the quarter.