Maintains No. 1 Position
Samsung Electronics maintained its No. 1 position in the global DRAM market in the third quarter of this year, but its market share dwindled.
According to market research firm Omdia, global DRAM sales in the third quarter of this year stood at US$17,548 million, down 29.8 percent from US$24,984 million in the previous quarter.
A slump has begun in the DRAM market in earnest as global demand continues to decline, analysts say. As demand for IT products plummeted due to global inflation, the DRAM market also went downhill this year. Wi Min-bok, a researcher at Daishin Securities, said, “Following the decline in PC DRAM prices in October, a decline in server DRAM prices has been expanding since November.”
As DRAM sales declined overall, sales of each company also descended. By company, Samsung Electronics posted US$7.133 billion in DRAM sales, down 34.2 percent from the previous quarter. SK Hynix logged US$5.246 billion, down 25.3 percent and Micron Technology US$4.35 billion, down 26.3 percent.
Samsung's DRAM market share stood at 40.6 percent in the third quarter, down 2.8 percentage points from the previous quarter (43.4 percent). On the other hand, SK Hynix's share increased by 1.8 percentage points to 29.9 percent, and Micron's also climbed by 1.2 percentage points to 24.8 percent.
Memory companies are adjusting output to respond to such a drop in prices. SK Hynix announced in October that it was considering reducing the input of wafers for legacy process products with relatively low profitability. Micron also said in November that it will reduce wafer input by 20 percent in November compared to the previous quarter (June-August) and further cut production after that.
The amount of new facility investment also shrank. SK Hynix plans to reduce its facility investment by 50 percent in 2023 compared to this year. Micron also plans to contract its investment by 50 percent in 2023 compared to 2022.
On the other hand, Samsung Electronics said it had no plans to cut production. Analysts view the company's move as a strategy to increase market share during the recovery period.
Industry insiders predict that DRAM shipments will increase by only 9 percent in 2023 due to production cuts. “This increase includes inventory,” said Doh Hyun-woo, a researcher at NH Investment & Securities. “Pure DRAM production volume will post a decrease year-on-year. If it happens, it will mark the first time that DRAM production decreases year over year.”