Flash revenues in 2003 to beat 2000, says Semico
Silicon Strategies
08/22/2003, 9:55 AM ET
PHOENIX -- In 2003, flash memory revenues are expected to beat those of the year 2000, despite continued volatility in pricing, according to a report from Semico Research Corp.
"The first half of 2003 showed surprisingly strong sales, with monthly revenues approximately equal to those of the same months of 2000, with the exception of March, which was over 33 percent above March of 2000," said Jim Handy, director of non-volatile research at Semico, a market research firm in Phoenix.
"In fact, with the exception of 2001, which was heading in the wrong direction, 2003 exhibited the strongest first quarter in flash history. Since 2000 was flash's strongest year ever, with over $10 billion in overall annual revenues, Semico sees every reason to expect 2003 to go above that figure," he said.
Semico continues to be bullish on the flash memory market at a time when many others see no reason to expect the market to recover.
The rationale for the positive outlook is quite simple. "Flash megabyte demand has not slackened from its normal growth, no matter how badly the market has performed before," Handy said. "Applications that consume all this flash are still growing, and the amount of memory used in these applications continues to grow, so there is no end in sight to strong megabyte demand growth."
Despite strong demand, prices remain volatile. "Although Semico and Intel both expected for NOR flash prices to firm early this year, this has not materialized. Still, we see the kind of vacillation in prices that occurs at the onset of price firming, so we may be well on our way to flat pricing in the second half," he said.
NAND prices have also fallen steeply, however, suppliers are starting to tell buyers that a shortage has developed, and prices are expected to rise shortly in response, but not to the levels enjoyed at the end of 2002.
Handy notes that the balance of supply and demand could shift again with a profound impact on pricing. "Although Semico does not expect to see much impact from the Fujitsu/AMD merger and Renesas' formation, we do expect serious repercussions from Hynix' entry into the NAND market, which they and STMicroelectronics announced recently," he said. "Hynix' capacity will certainly have a dramatic effect on the capacity/demand balance." |
