DRAM business profitable for Taiwan players in 4Q
(even if ASP return to a more typical pattern ASP's coming down from a relatively high level:
The main culprit for the revenue growth slowdown will be the return of normal price erosion, iSuppli explained. Last year, the global average selling price (ASP) declined by only 13%, far below the historical rate of a 30% annual decline.
Assuming DRAM makers can match cost reduction curve from 2006 the next year should look very good for DRAM guys because the lower price erosion form 2006 is still carried over to 2007
Latest news
Hans Wu, Taipei; Rodney Chan, DigiTimes.com [Friday 5 January 2007]
Taiwan players of the DRAM business ended last year with strong profits, according to local industry sources, adding that profits of Powerchip Semiconductor Corporation (PSC), ProMOS Technologies, Nanya Technology and Inotera Memories, taken together, exceeded NT$30 billion (US$920.5 million) in the fourth quarter of 2006. The sum is about three fourths of their total profits for the previous three quarters, the sources noted.
DRAM makers PSC, ProMOS and Nanya mainly benefited from from steady rises in DRAM prices, capacity expansion and their migration to 90nm processes, market observers said, adding that the same factors also benefited Nanya-invested DRAM foundry Inotera.
PSC reported NT$11.38 billion in revenues for December 2006, with profits for the fourth quarter expected to amount to NT$11-11.5 billion. The company's profits for the entire 2006 are expected to reach NT$22-25 billion.
ProMOS posted NT$7.82 billion in revenues for December 2006, and its fourth-quarter profits are estimated to total NT$8.5-9 billion. Its 2006 profits should total NT$14.5-15 billion.
Nanya Technology and Inotera, both members of the Formosa Plastics group, respectively made NT$7.5-8 billion and 4.5-4.6 billion in profits in the fourth quarter, according to estimates by sources at the companies. Nanya's and Inotera's profits for last year respectively amounted to NT$20.5-21 billion and NT$15.8-16.1 billion, the sources said. |
