DRAM, NOR flash markets set for growth in 2010

El Segundo, Calif. — While global DRAM sales in the first quarter of 2010 exceeded the total for the first six months of 2009, the NOR flash memory market is starting to emerge from its revenue slump, reports iSuppli Corp.

Worldwide DRAM revenue in the first quarter of 2010 neared $9.5 billion, up 9.7 percent from $8.7 billion from the fourth quarter of 2009, and up 181.6 percent from $3.4 billion in the first quarter of 2009, reports iSuppli.

“Both DRAM shipments and average selling prices (ASPs) surged in the first quarter due to stronger-than-anticipated demand for PCs and tight supplies,” said Mike Howard, senior analyst, DRAM, for iSuppli, in a statement. “It doesn’t take a math genius to figure out that the combination of larger shipments and higher prices results in rising revenue for the DRAM market. This strong performance bodes well for continued growth in 2010, possibly paving the way for the industry’s greatest year in history.”

iSuppli’s report, “DRAM Revenue: Going from Great to Greatest? A Look at Q1 2010 DRAM Revenue and Beyond,” reveals that DRAM revenue in the first quarter exceeded the $7.9 billion total for the entire first half of 2009. Only two quarters during the past 11 years achieved higher revenue than the first quarter of 2010: the fourth quarter of 2006 at $10.7 billion, and the first quarter of 2007 at $9.7 billion, according to iSuppli.


Over the past 20 years, DRAM prices in the first quarter typically fell by an average of 14.7 percent compared to the previous quarter, as sales and prices typically decline after a strong PC buying season in fourth quarter, said iSuppli. However, in the first quarter of 2010, prices actually rose by 2.9 percent on a sequential basis, according to the market researcher.

As a result, iSuppli projects a very strong year for the DRAM industry with second half demand even more robust than the first half. DRAM ASPs have maintained in the second quarter and in some cases DRAM parts are in such short supply, they are on allocation, according to Howard.

The NOR flash memory market revenue is projected to return to growth in 2010, driven by higher demand and an improved macroeconomic environment, according to iSuppi.

iSuppli’s report, “NOR Flash: Buoyed by Embedded Applications,” projects that the NOR flash memory will grow a modest 4.2 percent, rising to $4.8 billion in 2010 from $4.6 billion in 2009.

The embedded NOR flash market, comprised of a wide range of electronic products other than cell phones, accounts for 83 percent of all NOR shipments, at 3.3 billion units in 2010. iSuppli projects that unit shipments of NOR flash parts for the embedded market will grow at a 5.3 percent compound annual growth rate (CAGR) through 2014, while the cell phone segment will shrink due to the rising penetration of NAND flash memory technology.

Within the embedded NOR segment, the PC market — including the motherboard, disk drive and networking sectors — will consume more than 50 percent of shipments. Given that more than five NOR parts are needed for every computer system, and that PC growth projections hover around16 percent this year, the NOR flash market can expect a much better market in 2010 compared to 2009, according to iSuppli.


Other growth drivers include set-top boxes, automotive infotainment, computer monitors and televisions, said iSuppli.

“While iSuppli’s NOR revenue forecast is in line with previous projections showing a healthier 2010, the earlier-than-expected upturn of the market has caught flash makers off-guard,” said Michael Yang, senior analyst for iSuppli, in a statement.