Monday, May 5, 2008

iSuppli: 1Q 2008 DRAM revenues fall 39 percent

iSuppli: 1Q 2008 DRAM revenues fall 39 percent

Research firm iSuppli says the high stakes game of "chicken" between memory chip manufacturers is continuing the sharp decline in revenues overall.

While revenues only dropped 7.4 percent sequentially, year-over-year they plummeted 39 percent. Top DRAM producer Samsung padded its market share lead during the quarter, ending at 30.6 percent of the market, but it came at the expense of making a profit.

iSuppli says its research indicated that no DRAM supplier turned a profit, and during the third quarter losses were bigger than had been expected.

Samsung showed a 6.2 percent sequential, and 28 percent year-over-year drop. The news was worse for second-place Hynix, who is struggling to keep pace. That company saw revenues drop by 8.4 percent sequentially and cut in half year-over-year.

The market for DRAM chips, like Flash memory, has stagnated in revenue over the past several quarters, and has become less profitable as companies become more competitive.

iSuppli says there may be hope, however. The firm sees a market bottom, as prices seem to be near to the point where companies cannot risk dropping them any lower before risking financial issues as a result.

In fact, iSuppli believes DRAM prices could actually start to rise in the coming months due to shifts in supply and demand.


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