Welcome aboard, and The Prophet, here is more news supporting your point of view more than mine:
Toshiba to Shift from DRAMs to Flash Memories, Interim Report Says
March 28, 2000 (TOKYO) -- Toshiba Corp. recently unveiled its mid-term business plan for the three
years from fiscal 2000 to 2002.
Under that plan, flash memories will be nurtured as a mainstay of its semiconductor memory
business.
Sales of flash memories are expected to top those of DRAMs in fiscal 2001, according to Yasuo
Morimoto, president of Toshiba Semiconductor Company.
At the end of last year, Morimoto said the company's flash memories would tie with DRAMs in
business as early as 2003. Therefore, it is likely that Toshiba has decided to speed up its original
program substantially.
The mid-term business plan aims to achieve higher growth of the company's semiconductor sector
compared to other sectors. It plans to boost sales of semiconductors with annual growth rates of
about 20 percent, from 920 billion yen in fiscal 1999 to 1,570 billion yen in fiscal 2002. (106.85 yen =
US$1)
"The semiconductor market is expected to grow at an average growth rate of 16 percent. But,
Toshiba will surpass that growth," said Morimoto.
Only its electronic device segment, including semiconductors, bled red ink for fiscal 1999, posting a
loss of 25 billion yen. The electronic device segment, however, is expected to return to profitability
rapidly, with operating profit of 65 billion yen for fiscal 2000, 140 billion yen for fiscal 2001, and 160
billion yen for fiscal 2002, according to the mid-term business plan.
Toshiba envisions an operating profit of 420 billion yen for fiscal 2002 on a consolidated basis, more
than one third of which the company intends to garner from the currently loss-plagued electronic
device segment. Therefore, the mid-term business plan owes its success largely to the electronics
devices, or more specifically, to semiconductors.
The mid-term business plan defines NAND flash memories, system ICs and discrete devices as core
products of its semiconductor business. In particular, sales of flash memories are expected to
surpass those of DRAMs in fiscal 2001.
"Toshiba is now likely to be No. 3 in flash memory shipments. The company, however, will be the
world's largest flash memory maker as early as 2002 in terms of bits because NAND flash memories
are used for data storage devices, which incorporate a lot of bits," Morimoto said.
Toshiba already has been increasing production of NAND flash memories. As of last September,
the production marked 2.7 million units a month in terms of 64Mb bits. The company will continue to
accelerate the production from current 7 million units a month (on a 64Mb basis) to 12 million units a
month (on a 64Mb basis) this September.
It is likely that Toshiba has come to a definite decision to nurture flash memories by the mid-term
business plan, because at the end of 1999, Morimoto said that Toshiba's NAND flash memory
shipments would be tied with its DRAMs as early as fiscal 2003.
In DRAMs, Toshiba will focus on high value-added products such as Rambus DRAMs, while
shrinking its business for general-purpose products such as synchronous DRAMs. Although its
DRAMs will account for a smaller share of its memory business than flash memories in the future,
the gap between DRAM and flash memory sales will not widen continuously, because Toshiba still
aims for a worldwide market share of 10 percent in its DRAM business, company officials said.
As for system-on-a-chip business, Toshiba said shipments of CPU microchips for the PlayStation2
video game machines would total 1.5 million units by the end of this March. Also, shipments of
500,000 units a month are expected to continue until next September. Toshiba's financial report
ending this March shows sales of the 1.5 million CPU microchips for its semiconductor business
segment, company officials said.
Toshiba's public relations unit said that production of flash memories for use in memory cards is
proceeding on schedule, implying that Toshiba-made semiconductors have no specific problems.
Toshiba will positively expand outsourcing. Although the company has been already entrusting
production of DRAMs to Windbond Electronics Corp. of Taiwan, its outsourcing will be expanded
further in line with the mid-term business plan, to 25 percent by fiscal 2002 from current 7 percent of
total MOS IC microchips, company officials said.
Although allocations have been not disclosed yet, Toshiba plans to invest more than 350 billion
yen a year in R&D on a consolidated basis, as well as make capital investments of 350 billion yen a
year on a consolidated basis. By business segment, the company will give priority to its
semiconductor and LCD businesses, company officials said.
nikkeibp.asiabiztech.com.
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