DDR contract prices lift 3% to 5%; DDR2 quotes flat in 1HMay
Contract prices of DDR were lifted by a slight 3-5% while DDR2 prices were quoted flat in 1HMay. As Intel still reserve 30% of its chipsets for the DDR-supported 865 series in 2Q, solid demand of DDR keep prices stay strong. However, as the actual output of DDR trails behind demand, chipmakers succeed to raise their quotes by 3-5%. DDR2 prices were remained stable, thanks to the 10% ASP premium over DDR and its mainstream role at the market. Chipmakers are continue ramping up their DDR2 output.
DRAMeXchange records that the up tick of DDR2 module demand boost prices significantly over the last quarter. ASP of DDR2 512MB was quoted at US$41.23 in 1Q06, up 10.6% from US$37.27 in 4Q05. Prices of DDR module were relatively weak than DDR2 in terms of QoQ price trend. ASP of 512MB DDR were still quoted 10.6% lower than the same density DDR2 in 1Q at US$37.27, versus the US$39.52 in 4Q05.
DDR spot price was down 1% while DDR2 eTT spot price up 1.3%
DRAM transaction is persistently sluggish amid the week-long holiday at Asian regions with DXI only trended up by 0.9% (or 30 points) to 3,289 in the week May2-9. Despite the absence of obvious demand growth, the deprecation of US dollar against NT dollar prompt chipmakers to seek for price adjustment, thus, any hurting price downside risk is unlikely in near term, we believe" DDR 256Mb eTT (UTT) price reduced by 1.3% sequentially and closed at US$2.35 while prices of both DDR 256Mb 32Mbx8 400MHz and DDR 512Mb 64Mbx8 were stabilized at US2.46 and US$4.87. The emerge of DDR2 demand from the spot market grew prices up. DDR2 512Mb 64Mbx8 533MHz kept at US$5.07 level while the same-specification N.M.B gained 1.3% on week and closed at US$3.84.
2Gb/4Gb NAND Flash contract prices raised slightly at the end of April
The price rally of NAND Flash contract prices stabilize from early April with most makers insist to preserve price stability. Some even insisted to raise quotes for 2Gb to US$5-6. Hynix quotes its SLC made 4Gb at US7.10-7.20 and Toshiba quoted at US$8. Prices of high-density 8/16Gb were still subject to slight drop with 8Gb SLC quoted at US$17-19, MLC at US$15-17; 16Gb SLC at US$35-36, MLC at US$33-34. Price changes of chipmakers vary on distinct production situations.
The latest shipped prices for 2Gb/4Gb were just raised slightly while 8Gb/16Gb still dropped by an approximate of 5% in 2HApr. We've noted that both Samsung and Hynix had raised their quotes to major customers like Flash card makers at early May, though the quotes were not the finalized quotes for the latest batch of shipment yet.
Note : DRAMeXchange will adjust our release frequency of NAND Flash contract prices from once a month to twice a month from this update in order to deliver a real-time market trend amid the elasticity of the NAND Flash market.
In compare with the price negotiation mechanism of DRAM, NAND Flash makers adjust their price negotiation period and frequency upon customer relationship, shipment amount and market trend. The negotiated prices will remain unchanged if the supply-demand balance is healthy but makers may adjust their final quotes before shipment starts, especially during the shipment peaks near month end. Market-sensitive prices are usually reflected when shipment approached during these periods.
Since the price negotiation period between sellers and buyers is flexible, the announced prices were the recent quotes that chipmakers set for their latest batch of shipment. The published NAND Flash quotes on April 17 were the prices that chipmakers quoted on their latest shipment prior to the published date and reflected the price trend during March 17 to April 17. As chipmakers were exposed to the financial pressures during the quarterly/annually end during late March, the rapid growth in shipment dragged prices down and the released prices should be interpreted as a price indication during this period, rather than the stabilizing price trend that emerged from early April.
1Gb/2Gb NAND Flash spot prices show tepid signs
NAND Flash transaction at the spot market was notionally listless in the week May2-8. Positive signs emerged during May4-5 on manufacturers preparation on production resuming.
Although the NAND Flash spot market tended weak on May 2, prices for both 1Gb and 2Gb chips stabilized from May 3 along with China makers transaction resuming after the week-long holiday. As inventory for these density chips is in tight, slight price gains are observed.
Prices of 4Gb were also notionally stable despite the slight drop that recorded on May 2. Price of 8Gb suffered relatively larger price fluctuation while quotes for 16Gb were set still at the US$35.78 level.
Sony and Fujitsu both outshine in 2005 annual revenues
Despite revenues and margins growth, Sony deserves more improvement at its electronics goods sales
Sony announced that its fiscal 2005 revenues (Apr05-Mar06) grew by a slight 4.4% YoY at 7,457bn yen with operating margins shoot by 67.9% to 191bn yen but the sales from its electronics sales just improved slightly.
Sales contribution from electronics goods grew 1.7% YoY at 150.5bn yen on the solid sales growth of LCD TV and RPTV. However, the sales amount recessed by only 3% YoY and reflected the positive impact of Japanese yen against US dollar in this period. Loss from electronics goods was reported at 30.9bn yen, down by 3.4bn yen from FY 2004's 34.3bn yen.
Despite Sony records sales growth for its game consoles, the operation margins did not grew in a corresponding trend. Sales of game consoles grew by 27% YoY at 958.6bn yen with a majority of this sales amount were contributed by the 14.06mn PSP shipped. Operation margins for game console, however, were declined by 62% at 8.7bn yen on the associated R&D expenses from PS3. Sony projects that shipment for its upcoming PS3 will reach 6mn units during Nov06 to Mar07 after the game console launched in the coming November.
For movie related sales, Sony records its sales amount grew by 1.7% at 745.9bn yen but operation margins slashed by 61% at 27.4bn yen amid the drop of number of movies as compare with the Spiderman 2 that launched last year.
Financial business is the segment that contributes most to Sony's revenues in the last year. The sales amount grew by 32.6% with operating margins shoot by 239.4% at 188.3bn yen. The swing of industry-wide upside at stock market is the major cause. Music related business also drew attention with its encouraging 286.4% growth (at 16.2bn yen), despite the sales amount slipped by 11.1%.
Overall speaking, Sony projects for a 10% revenues growth in FY 2006 at 8,200bn yen while operation margins are expected to decline by 48% at 100bn yen. Sony budgets an additional 20% of expenses at equipment expansion at 460bn yen. Among this budgeted amount, 170bn yen will be allotted for semiconductor business, a growth of 30bn yen an year.
Fujitsu records encouraging results after reshuffle
Fujitsu reports its FY 2005 (Apr05-Mar06) revenues grew by a slight YoY 0.6% at 4,791bn yen with operation margins grew by 3.8% at 181.4bn yen. Both revenues and operation margins picked up along with the reshuffle of the re-defined three major business units in 2005.
Revenues from technology solutions and IT system & software contributed a total of 164.2bn yen Operation margins from these segments were up 1.7% (49.5bn yen) and 15.6% (22.1bn yen), thanks to the growth of UNIX server shipment from overseas, opto-transmittance system demand from North America and the IT service outsourcing business from UK.
Contribution from PC, handset and hard disk drive (HDD) grew 2.8% at 28.5bn yen while operation margins grew 10% at 3.1bn yen. Although Fujitsu recorded PC shipment growth at overseas regions, the company suffered setback in Japan amid the keen domestic competition. HDD sales and operation margins, however, show encouraging growth.
The component unit, which includes both LSI and electronics component, reported a sales reduction of 11% at 87.2bn yen on the spin-off its FPD business. Operation margins at this unit grew by a slight 2.2% at 700bn yen.
Industry
3C applications to rise as new NAND Flash demand drivers
Series of NAND Flash-based storage applications and multimedia-oriented handhelds should supplement new ingredients for NAND demand after 2006. The strengthening consolidation of 3C (computer, consumer electronics & communications) will grow demand for associated memory card density in order to feed rising demand for video storage. Buoyed with the shrinking per MB cost of NAND, the average density of embedded NAND Flash at 3C applications should keep escalate.
DRAMeXchange foresees that more 3C goods will able to house as much as 4GB memory card in 2007 by the advancement of build-in firmware solution. Memory cards will be growing popular at other consumer electronics goods such as digital flat displays. We observe that some sellers are advertising their products via DTVs or portable display devices in those regions that are lack of comprehensive infrastructure. These devices are usually equip with external memory slot in order to broadcast stored propaganda clips that stored in memory cards and this substantial demand is also serving as an encouraging sign for NAND demand in the future.
The growth of NAND-based storage applications should drive NAND demand from 2007. Flash-based storage devices among portable consumer electronics should start replacing some low-density micro HDD from 2007. The solid foothold of low-cost HDD should persist without being threatened by the introduction of low-density Flash-based Solid State disk (SSD) for PCs by 2008 amid the current technology roadmap of NAND flash makers.
Microsoft's Vista, the brand-new 64-bit OS, will support Samsung's hybrid HDD architecture. Intel that schedules to introduce the Robson cache technology on its Santa Rosa platform for notebooks in 1Q07 hints another NAND demand driving force. Under this new technology, NAND will be adopted as cache memory to consolidate with HDD in the Hybrid HDD.
Handsets vendor, at the meantime, are also paving the path for new NAND demand driver as the upcoming multimedia-enriched applications should grow density of memory cards. We expect the proportion of high-density memory cards to rise in 2007.
Nokia, Apple, Microsoft, Samsung and Sony are all developing brand-new multimedia handsets that enable handsets to perform duties as DSC, MP3, PMP, PDA, GPS, portable game console, DV & TV broadcasting carrier.
The rise of these multimedia-enriched handsets will spark the competition with 3C (consumer electronics, computer, and communications) goods and we should see low-end MP3 players, DSCs and PMPs to encounter stiff competition in near future.
The growing popularity of mobile TV, especially in mature markets, is a positive sign for NAND market for no doubt but we do not expect TV phone to spur NAND demand much by 2008. Industry players have to overcome the barriers from infrastructure and industrial standards and make a more concrete step on deployment on the hand. The bonds from battery life and the demand for suppressing cost also constrain the growth of TV phone and associated NAND demand at the meantime. With the anticipated substantial demand for NAND among TV phone, the shrink of price per MB should help boosting shipment for external high-density memory cards over the coming years.
News Summary (May.3rd~May 9th)
May 2006
2006/5/9 SMIC China-based Semiconductor Manufacturing International Corporation (SMIC) and US-based Aurora Systems have announced Aurora's LCOS (liquid-crystal-on-silicon) panel chips have successfully entered volume commercial production at SMIC.The digital LCOS panel chip is designed by Aurora Systems in both 1,080p (1,920~{!A~}1,080) and 720p (1,280x720) resolutions for rear-projection TV (RPTV) in high-definition format.Several leading consumer electronics manufacturers have already employed these LCOS panel chips in the production of high-resolution, large-size RPTVs.Aurora's collaboration with SMIC started in early 2005, said Poking Li, acting CEO of Aurora Systems.
Contract prices of DDR were lifted by a slight 3-5% while DDR2 prices were quoted flat in 1HMay. As Intel still reserve 30% of its chipsets for the DDR-supported 865 series in 2Q, solid demand of DDR keep prices stay strong. However, as the actual output of DDR trails behind demand, chipmakers succeed to raise their quotes by 3-5%. DDR2 prices were remained stable, thanks to the 10% ASP premium over DDR and its mainstream role at the market. Chipmakers are continue ramping up their DDR2 output.
DRAMeXchange records that the up tick of DDR2 module demand boost prices significantly over the last quarter. ASP of DDR2 512MB was quoted at US$41.23 in 1Q06, up 10.6% from US$37.27 in 4Q05. Prices of DDR module were relatively weak than DDR2 in terms of QoQ price trend. ASP of 512MB DDR were still quoted 10.6% lower than the same density DDR2 in 1Q at US$37.27, versus the US$39.52 in 4Q05.
DDR spot price was down 1% while DDR2 eTT spot price up 1.3%
DRAM transaction is persistently sluggish amid the week-long holiday at Asian regions with DXI only trended up by 0.9% (or 30 points) to 3,289 in the week May2-9. Despite the absence of obvious demand growth, the deprecation of US dollar against NT dollar prompt chipmakers to seek for price adjustment, thus, any hurting price downside risk is unlikely in near term, we believe" DDR 256Mb eTT (UTT) price reduced by 1.3% sequentially and closed at US$2.35 while prices of both DDR 256Mb 32Mbx8 400MHz and DDR 512Mb 64Mbx8 were stabilized at US2.46 and US$4.87. The emerge of DDR2 demand from the spot market grew prices up. DDR2 512Mb 64Mbx8 533MHz kept at US$5.07 level while the same-specification N.M.B gained 1.3% on week and closed at US$3.84.
2Gb/4Gb NAND Flash contract prices raised slightly at the end of April
The price rally of NAND Flash contract prices stabilize from early April with most makers insist to preserve price stability. Some even insisted to raise quotes for 2Gb to US$5-6. Hynix quotes its SLC made 4Gb at US7.10-7.20 and Toshiba quoted at US$8. Prices of high-density 8/16Gb were still subject to slight drop with 8Gb SLC quoted at US$17-19, MLC at US$15-17; 16Gb SLC at US$35-36, MLC at US$33-34. Price changes of chipmakers vary on distinct production situations.
The latest shipped prices for 2Gb/4Gb were just raised slightly while 8Gb/16Gb still dropped by an approximate of 5% in 2HApr. We've noted that both Samsung and Hynix had raised their quotes to major customers like Flash card makers at early May, though the quotes were not the finalized quotes for the latest batch of shipment yet.
Note : DRAMeXchange will adjust our release frequency of NAND Flash contract prices from once a month to twice a month from this update in order to deliver a real-time market trend amid the elasticity of the NAND Flash market.
In compare with the price negotiation mechanism of DRAM, NAND Flash makers adjust their price negotiation period and frequency upon customer relationship, shipment amount and market trend. The negotiated prices will remain unchanged if the supply-demand balance is healthy but makers may adjust their final quotes before shipment starts, especially during the shipment peaks near month end. Market-sensitive prices are usually reflected when shipment approached during these periods.
Since the price negotiation period between sellers and buyers is flexible, the announced prices were the recent quotes that chipmakers set for their latest batch of shipment. The published NAND Flash quotes on April 17 were the prices that chipmakers quoted on their latest shipment prior to the published date and reflected the price trend during March 17 to April 17. As chipmakers were exposed to the financial pressures during the quarterly/annually end during late March, the rapid growth in shipment dragged prices down and the released prices should be interpreted as a price indication during this period, rather than the stabilizing price trend that emerged from early April.
1Gb/2Gb NAND Flash spot prices show tepid signs
NAND Flash transaction at the spot market was notionally listless in the week May2-8. Positive signs emerged during May4-5 on manufacturers preparation on production resuming.
Although the NAND Flash spot market tended weak on May 2, prices for both 1Gb and 2Gb chips stabilized from May 3 along with China makers transaction resuming after the week-long holiday. As inventory for these density chips is in tight, slight price gains are observed.
Prices of 4Gb were also notionally stable despite the slight drop that recorded on May 2. Price of 8Gb suffered relatively larger price fluctuation while quotes for 16Gb were set still at the US$35.78 level.
Sony and Fujitsu both outshine in 2005 annual revenues
Despite revenues and margins growth, Sony deserves more improvement at its electronics goods sales
Sony announced that its fiscal 2005 revenues (Apr05-Mar06) grew by a slight 4.4% YoY at 7,457bn yen with operating margins shoot by 67.9% to 191bn yen but the sales from its electronics sales just improved slightly.
Sales contribution from electronics goods grew 1.7% YoY at 150.5bn yen on the solid sales growth of LCD TV and RPTV. However, the sales amount recessed by only 3% YoY and reflected the positive impact of Japanese yen against US dollar in this period. Loss from electronics goods was reported at 30.9bn yen, down by 3.4bn yen from FY 2004's 34.3bn yen.
Despite Sony records sales growth for its game consoles, the operation margins did not grew in a corresponding trend. Sales of game consoles grew by 27% YoY at 958.6bn yen with a majority of this sales amount were contributed by the 14.06mn PSP shipped. Operation margins for game console, however, were declined by 62% at 8.7bn yen on the associated R&D expenses from PS3. Sony projects that shipment for its upcoming PS3 will reach 6mn units during Nov06 to Mar07 after the game console launched in the coming November.
For movie related sales, Sony records its sales amount grew by 1.7% at 745.9bn yen but operation margins slashed by 61% at 27.4bn yen amid the drop of number of movies as compare with the Spiderman 2 that launched last year.
Financial business is the segment that contributes most to Sony's revenues in the last year. The sales amount grew by 32.6% with operating margins shoot by 239.4% at 188.3bn yen. The swing of industry-wide upside at stock market is the major cause. Music related business also drew attention with its encouraging 286.4% growth (at 16.2bn yen), despite the sales amount slipped by 11.1%.
Overall speaking, Sony projects for a 10% revenues growth in FY 2006 at 8,200bn yen while operation margins are expected to decline by 48% at 100bn yen. Sony budgets an additional 20% of expenses at equipment expansion at 460bn yen. Among this budgeted amount, 170bn yen will be allotted for semiconductor business, a growth of 30bn yen an year.
Fujitsu records encouraging results after reshuffle
Fujitsu reports its FY 2005 (Apr05-Mar06) revenues grew by a slight YoY 0.6% at 4,791bn yen with operation margins grew by 3.8% at 181.4bn yen. Both revenues and operation margins picked up along with the reshuffle of the re-defined three major business units in 2005.
Revenues from technology solutions and IT system & software contributed a total of 164.2bn yen Operation margins from these segments were up 1.7% (49.5bn yen) and 15.6% (22.1bn yen), thanks to the growth of UNIX server shipment from overseas, opto-transmittance system demand from North America and the IT service outsourcing business from UK.
Contribution from PC, handset and hard disk drive (HDD) grew 2.8% at 28.5bn yen while operation margins grew 10% at 3.1bn yen. Although Fujitsu recorded PC shipment growth at overseas regions, the company suffered setback in Japan amid the keen domestic competition. HDD sales and operation margins, however, show encouraging growth.
The component unit, which includes both LSI and electronics component, reported a sales reduction of 11% at 87.2bn yen on the spin-off its FPD business. Operation margins at this unit grew by a slight 2.2% at 700bn yen.
Industry
3C applications to rise as new NAND Flash demand drivers
Series of NAND Flash-based storage applications and multimedia-oriented handhelds should supplement new ingredients for NAND demand after 2006. The strengthening consolidation of 3C (computer, consumer electronics & communications) will grow demand for associated memory card density in order to feed rising demand for video storage. Buoyed with the shrinking per MB cost of NAND, the average density of embedded NAND Flash at 3C applications should keep escalate.
DRAMeXchange foresees that more 3C goods will able to house as much as 4GB memory card in 2007 by the advancement of build-in firmware solution. Memory cards will be growing popular at other consumer electronics goods such as digital flat displays. We observe that some sellers are advertising their products via DTVs or portable display devices in those regions that are lack of comprehensive infrastructure. These devices are usually equip with external memory slot in order to broadcast stored propaganda clips that stored in memory cards and this substantial demand is also serving as an encouraging sign for NAND demand in the future.
The growth of NAND-based storage applications should drive NAND demand from 2007. Flash-based storage devices among portable consumer electronics should start replacing some low-density micro HDD from 2007. The solid foothold of low-cost HDD should persist without being threatened by the introduction of low-density Flash-based Solid State disk (SSD) for PCs by 2008 amid the current technology roadmap of NAND flash makers.
Microsoft's Vista, the brand-new 64-bit OS, will support Samsung's hybrid HDD architecture. Intel that schedules to introduce the Robson cache technology on its Santa Rosa platform for notebooks in 1Q07 hints another NAND demand driving force. Under this new technology, NAND will be adopted as cache memory to consolidate with HDD in the Hybrid HDD.
Handsets vendor, at the meantime, are also paving the path for new NAND demand driver as the upcoming multimedia-enriched applications should grow density of memory cards. We expect the proportion of high-density memory cards to rise in 2007.
Nokia, Apple, Microsoft, Samsung and Sony are all developing brand-new multimedia handsets that enable handsets to perform duties as DSC, MP3, PMP, PDA, GPS, portable game console, DV & TV broadcasting carrier.
The rise of these multimedia-enriched handsets will spark the competition with 3C (consumer electronics, computer, and communications) goods and we should see low-end MP3 players, DSCs and PMPs to encounter stiff competition in near future.
The growing popularity of mobile TV, especially in mature markets, is a positive sign for NAND market for no doubt but we do not expect TV phone to spur NAND demand much by 2008. Industry players have to overcome the barriers from infrastructure and industrial standards and make a more concrete step on deployment on the hand. The bonds from battery life and the demand for suppressing cost also constrain the growth of TV phone and associated NAND demand at the meantime. With the anticipated substantial demand for NAND among TV phone, the shrink of price per MB should help boosting shipment for external high-density memory cards over the coming years.
News Summary (May.3rd~May 9th)
May 2006
2006/5/9 SMIC China-based Semiconductor Manufacturing International Corporation (SMIC) and US-based Aurora Systems have announced Aurora's LCOS (liquid-crystal-on-silicon) panel chips have successfully entered volume commercial production at SMIC.The digital LCOS panel chip is designed by Aurora Systems in both 1,080p (1,920~{!A~}1,080) and 720p (1,280x720) resolutions for rear-projection TV (RPTV) in high-definition format.Several leading consumer electronics manufacturers have already employed these LCOS panel chips in the production of high-resolution, large-size RPTVs.Aurora's collaboration with SMIC started in early 2005, said Poking Li, acting CEO of Aurora Systems.
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