Inexorable ‘NAND Power’
As NAND flash memory posted quarterly operating profit of 1 trillion won (US$895.66 million), it is emerging as Samsung Electronics’ new growth engine. NAND solutions, which accounted for a fourth of semiconductor revenues, are expected to make record high operating profits in the third quarter, fueled by growing demand of solid-state drives (SSDs).
According to industry sources on August 25, Samsung Electronics will see its operating profits of NAND flash products in the memory semiconductor business reach 990 billion won (US$886.7 million) in the third quarter of this year.
With highly differential technologies, including three-dimensional (3D) laminating technology, and high demand of SSDs, NAND, which has supplemented DRAM and improved semiconductor revenue by 20 percent, is showing a steep rise in revenue.
NAND solutions, which made a 19.2 percent, or 530 billion won (US$474.7 million) of operating profit in the semiconductor sector in the first quarter this year, took up 26.1 percent of the total operating profit amounting to 690 billion won (US$618 million) throughout all quarters. Moreover, NAND is expected to make operating profit of 1 trillion won (US$895.66 million) in the third quarter, making up for more than 30 percent of the total operating profit. The biggest factor for the largest profits is SSD which is in great demand now. Market watchers predicts that Samsung Electronics, which has 3D V-NAND flash memory, will continuously expand its share in the market of SSD for both consumers and enterprises.
Market research firm Gartner said that Samsung Electronics ranked first in terms of market share with 54 percent in the global PC SSD market last year, followed by SanDisk with 8.1 percent and Micron with 6.9 percent. The company also increased its share in the global enterprise SSD market from 9.8 percent in 2012 to 17.6 percent last year, pursuing after the market leader, Intel, with 23 percent.
Gartner expects that all SSD revenues, such as PC and data center, will have a compound annual growth rate (CAGR) of 57 percent in the 2015-2020 period, up 12 percent point from earlier expectation. In particular, the demand of SSDs will significantly rise from next year when the structure of lap tops will change and replacement period of data centers will start.