The global DRAM industry saw 13.6 percent quarter-over-quarter (QoQ) increase in revenue during the third quarter of 2024, reaching $26.02 billion, according to the latest data from TrendForce.
This surge was primarily driven by strong demand for DDR5 and high-bandwidth memory (HBM) in data centers, despite a decline in shipments of LPDDR4 and DDR4 memory. The slowdown in LPDDR4 and DDR4 shipments was mainly attributed to inventory reductions by Chinese smartphone brands and an increase in production capacity from Chinese DRAM suppliers.
Average selling prices (ASPs) continued their upward trend from the previous quarter, with contract prices for DRAM rising between 8 percent to 13 percent. The rise in prices was also bolstered by the growing share of HBM in the market, as it gradually replaces conventional DRAM in certain high-performance applications.
Outlook for 4Q24: Mixed Expectations
Looking ahead to the fourth quarter of 2024, TrendForce forecasts an overall increase in DRAM bit shipments, although the capacity limitations driven by HBM production could temper the expected price hike. Additionally, the aggressive inventory clearance by PC OEMs and smartphone brands, alongside the expansion of Chinese DRAM suppliers’ capacities, could push prices lower for conventional DRAM products. As a result, contract prices for standard DRAM and blended DRAM-HBM products are projected to experience a decline.
Top Manufacturers See Mixed Performance
The top three DRAM manufacturers saw a significant uptick in revenues. Samsung led the pack with $10.7 billion in revenue, a 9 percent QoQ growth. Despite a flat quarter in terms of bit shipments, Samsung’s revenue growth was fueled by strategic inventory clearing of LPDDR4 and DDR4 products.
SK hynix secured second place with $8.95 billion in revenue, marking a 13.1 percent QoQ increase. While SK hynix experienced a boost in HBM3e shipments, the overall increase was offset by a slight decline in LPDDR4 and DDR4 shipments.
Micron saw the most dramatic growth, with a 28.3 percent QoQ increase in revenue, reaching $5.78 billion. This surge was driven by strong demand for server DRAM and HBM3e products, which helped to offset declines in other areas. Micron also enjoyed a 13 percent increase in bit shipments.
Struggles for Taiwanese Suppliers
In contrast, Taiwanese DRAM suppliers struggled in 3Q24. Nanya Technology reported a more than 20 percent QoQ decline in bit shipments due to weaker consumer DRAM demand and increasing competition from Chinese suppliers in the DDR4 market. Its operating profit margin worsened, dropping from -23.4 percent to -30.8 percent, further impacted by a power outage incident.
Winbond also faced a downturn, with an 8.6 percent QoQ drop in revenue, falling to $154 million, driven by a decrease in consumer DRAM demand. PSMC, another Taiwanese player, saw a significant 27.6 percent QoQ decline in revenue from its consumer DRAM segment, though its total DRAM revenue rose 18 percent QoQ when including revenue from its foundry business.
The latest results reflect a complex and evolving DRAM market, where data center demand and HBM growth are outpacing traditional DRAM applications, creating both opportunities and challenges for suppliers across the globe.
