DRAM Market Share
Amid the prevailing downturn in the semiconductor sector, Samsung Electronics managed to maintain its leadership in the global memory semiconductor market during the first quarter of this year, while SK hynix encountered a decline in its market standing.
According to market research firm Omdia on Aug. 6, Samsung Electronics held onto its commanding position in the global DRAM market for the first quarter with an unaltered market share of 42.8 percent, the same as the previous quarter. Samsung Electronics experienced a 61.2 percent reduction in DRAM sales during the first quarter, amounting to US$4.013 billion, in comparison to the equivalent period the previous year, and a 25.2 percent contraction relative to the preceding quarter. This diminished performance is primarily attributed to the continued recessionary trend in the semiconductor market, leading to dwindling sales and a decline in revenue resulting from industrywide production cutbacks.
In contrast, SK hynix witnessed a decline of 2.3 percentage points in its first-quarter DRAM market share, falling to 24.7 percent from the previous quarter’s 27.0 percent. Moreover, SK hynix’s industry ranking slipped from 2nd to 3rd place as it was overtaken by Micron, a U.S.-based semiconductor manufacturer, which secured the 2nd position with a market share of 27.2 percent. This shift can be attributed to SK hynix’s proactive and aggressive implementation of production cuts as a preemptive measure to mitigate the impact of decreasing DRAM prices.
The dynamics in the NAND memory market also favored Samsung Electronics as it maintained its position at the forefront. Despite a decline in NAND flash sales by half during the first quarter, standing at US$2.99 billion compared to the corresponding period in the previous year, Samsung Electronics managed to achieve a 0.4 percentage point increase in market share, reaching 34.3 percent in comparison to the preceding quarter’s 33.9 percent. Notably, other key players in the NAND memory market included Japan’s KIOXIA at 19.5 percent, U.S.-based Western Digital at 15.9 percent, and SK hynix, including its subsidiary Solidigm, at 15.1 percent. SK hynix experienced a decline of 1.7 percentage points in its NAND market share from the preceding quarter’s 16.8 percent, causing it to slide from 3rd to the 4th position in the industry pecking order.
The NAND segment is expected to experience further reductions due to its lower profitability compared to DRAM, coupled with persistently high levels of inventory. An industry insider said, “While demand for high-capacity and high-performance products like DDR5 and HBM is recovering due to AI development demand, NAND lacks the driving force for demand recovery, and customer inventory levels still remain low. There is a need to defend against price declines and losses through reductions.”
During their 2nd quarter earnings release conference calls, both Samsung Electronics and SK hynix revealed plans to introduce additional production cuts with a focus on NAND-centered operations.