DRAM industry’s 2023Q1 revenue fell by 21.2% from the previous quarter
In a newly published report, TrendForce discloses that the revenue for the DRAM industry in the first quarter of this year amounted to approximately $9.66 billion, marking a sequential decline of 21.2%, thereby extending the downturn for the third consecutive quarter. Amongst the major suppliers, only Micron observed an ascending trend in shipments, while all three behemoths experienced a decline in their Average Selling Price (ASP).
As the leading industry behemoth, Samsung experienced a slump in both its shipments and ASP, with revenues approximating $4.17 billion, representing a sequential fall of 24.7%. Owing to orders secured at the end of the last year, Micron managed to overtake SK Hynix to ascend to the second position in the first quarter. Its revenue stood at $2.72 billion, witnessing a marginal sequential dip of 3.8%, thereby reducing the extent of the downturn. SK Hynix slipped to the third spot, with shipments and ASP both tumbling by over 15% and revenues approximating $2.31 billion, translating into a sequential contraction of 31.7%.
Given the precipitous decline in the ASP, all three giants transitioned from profit to lose in terms of operating profit margin in the first quarter. Coupled with the continued downtrend in DRAM prices, they are anticipated to remain in a state of operating loss in the second quarter. In response, all three have initiated production cuts, resulting in the operational rate for Samsung, Micron, and SK Hynix in the second quarter dropping to 77%, 74%, and 82% respectively.
TrendForce conjectures that the current market scenario of oversupply has not yet ameliorated, with prices continuing on a downward trajectory. However, with original equipment manufacturers progressively initiating production cuts, the rate of decline in DRAM prices in the second half of the year is projected to gradually narrow. Looking ahead to the second quarter of the year, even though shipments are expected to increase, the magnitude of revenue growth is forecasted to be rather limited due to the persistent substantial fall in prices.