SAN FRANCISCO—Global DRAM revenue fell to $8.3 billion in the first quarter, down 5.6 percent from the fourth quarter of 2010 due to weak pricing, according to a report by market research firm IHS iSuppli.
Sales of DRAM chips fell short of the expected $9 billion in sales for the quarter on softer-than-expected average selling price (ASP) of $1.61 during the quarter, short of the projected $1.89, according to IHS. The DRAM ASP in the fourth quarter of 2010 was $1.97, according to the firm.
DRAM sales and ASPs declined compared to the first quarter of 2010, when they were $9.4 billion and $2.78, respectively, according to IHS.
"Buffeted by weak market conditions, companies across the DRAM space saw their revenues contract across the board in the first quarter of this year," said Mike Howard, principal analyst for DRAM and memory at HIS, in a statement. "For the top eight DRAM companies—together responsible for 98.1 percent of the total industry—revenue in the first quarter this year fell for every single player, although the rankings held steady."
South Korea's Samsung Electronics Co. Ltd. maintained its hold on the top spot in DRAM sales in the first quarter, accounting for 39.3 percent of the market despite a DRAM revenue decline to $3.3 billion from $3.6 billion in the fourth quarter of 2010, IHS said. Samsung's market share declined from 41.3 percent in the fourth quarter of 2010, IHS said.
Despite losing two points of market share, Samsung's share of the DRAM market remained nearly double that of its closest competitor, fellow South Korean firm Hynix Semiconductor Inc., according to IHS. According to the market research firm, history points to Samsung being poised for a strong rebound after its first quarter sales decline. After Samsung’s previous two sequential declines in revenue—in the first quarter of 2007 and the fourth quarter of 2009—the company experienced a period of robust growth, IHS said. Samsung’s next move is likely to be another all-out grab for DRAM market share, the firm said.
Samsung’s slight loss of market share at the top redounded to the benefit of the four players that saw their share rise during the first quarter, even though each firm’s revenue declined like everyone else, according to IHS.
Elpida Memory Inc. and Micron Technology Inc. are likely to swing back and forth battling for the No. 3 market share spot in DRAM in 2011, according to IHS.Neither appears ready to challenge Hynix for second place in the near future, according to the firm.
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