Taiwan DRAM makers optimistic about 3Q after posting losses in 1H

Dom · Aug 6, 2003, 08:23 AM

Taiwan’s memory chipmakers reported losses of NT$8.0 billion in the first half of the year, but they are upbeat about the industry’s outlook amid stronger demand.

Nanya Technology, Winbond Electronics, ProMOS Technologies and Powerchip Semiconductor Corporation (PSC), which together contribute the fourth-largest supply of DRAM worldwide, posted losses that ranged from NT$1.5 billion and NT$2.9 billion from January to June. The companies blamed soft demand for PCs and declines in product prices for the losses.

Looking ahead, they are hoping a traditional hot season will spur demand, triggering expectations that a turnaround will come as soon as the third quarter. “There’ll be little downside for ASPs (average selling prices) for the rest of this year,” said Wilson Wen, vice president of Winbond. “They should either stay flat or rise gradually.” According to DRAMeXchange, 256Mbit DDR400 spot prices jumped 0.8% to US$4.97 today.

Still, some are more optimistic. Nanya Technology, whose customers include OEMs such as Dell and Hewlett-Packard (HP), expects a shortage in DRAM supply throughout the year. “We’re expecting a serious shortage in supply at least till the end of this year,” said Charles Kau, executive vice president of Nanya Technology.

Taiwan DRAM makers like Nanya Technology had difficulties raising money for expansion of their 12-inch wafer facilities in the first half partly because of the SARS outbreak as well as the huge losses they suffered in 2002. As the situation has improved, Taiwanese companies are kicking off their plans to raise funds for equipment purchases, but it will take a few months to complete the fund-raising. In addition, it would another four to six months to begin production, Kau said.

Take Nanya for example. It is slated to produce its first 12-inch wafers in the second quarter of 2004, he said. “We’ll have to wait until late next year if we want to see any volume production,” said the executive vice president.

PSC, which makes DRAM for Elpida Memory of Japan, agreed that DRAM supply will be tight through 2004. “Samsung Electronics, Powerchip and Elpida are the only ones that have the ability to have mass production of the wafers next year,” said Eric Tan, a PSC vice president. The company is scheduled to make 35,000 of the wafers per month at the end of 2004, compared with 12,000 currently, he said.

ProMOS now is producing 11,000, with 13,500 scheduled for the end of this year, said a company official.

Winbond will not have any output of the wafers as it cancelled its plan to build a 12-inch fab.

Samsung Electronics and Hynix Semiconductor of South Korea and Boise, Idaho-based Micron Technology have not been able to ramp up their DDR400 production rapidly, adding to the concern about a supply shortage, some analysts said.

Last month, the US International Trade Commission (ITC) assessed a 44.71% tariff on all Hynix DRAM products shipped to the US, reducing the South Korean chipmaker’s shipments to the world’s biggest market.

The assessment came after the ITC concluded Hynix damaged the US DRAM industry by accepting illegal financial aid from banks related to the South Korean government.

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Source: DigiTimes

Aug 6, 2003, 08:23 AM	#1
Dom DriverHeaven Extreme Member Join Date: Jun 2002 Posts: 12,940 Rep Power: 0	Taiwan DRAM makers optimistic about 3Q after posting losses in 1H Taiwan’s memory chipmakers reported losses of NT$8.0 billion in the first half of the year, but they are upbeat about the industry’s outlook amid stronger demand. Nanya Technology, Winbond Electronics, ProMOS Technologies and Powerchip Semiconductor Corporation (PSC), which together contribute the fourth-largest supply of DRAM worldwide, posted losses that ranged from NT$1.5 billion and NT$2.9 billion from January to June. The companies blamed soft demand for PCs and declines in product prices for the losses. Looking ahead, they are hoping a traditional hot season will spur demand, triggering expectations that a turnaround will come as soon as the third quarter. “There’ll be little downside for ASPs (average selling prices) for the rest of this year,” said Wilson Wen, vice president of Winbond. “They should either stay flat or rise gradually.” According to DRAMeXchange, 256Mbit DDR400 spot prices jumped 0.8% to US$4.97 today. Still, some are more optimistic. Nanya Technology, whose customers include OEMs such as Dell and Hewlett-Packard (HP), expects a shortage in DRAM supply throughout the year. “We’re expecting a serious shortage in supply at least till the end of this year,” said Charles Kau, executive vice president of Nanya Technology. Taiwan DRAM makers like Nanya Technology had difficulties raising money for expansion of their 12-inch wafer facilities in the first half partly because of the SARS outbreak as well as the huge losses they suffered in 2002. As the situation has improved, Taiwanese companies are kicking off their plans to raise funds for equipment purchases, but it will take a few months to complete the fund-raising. In addition, it would another four to six months to begin production, Kau said. Take Nanya for example. It is slated to produce its first 12-inch wafers in the second quarter of 2004, he said. “We’ll have to wait until late next year if we want to see any volume production,” said the executive vice president. PSC, which makes DRAM for Elpida Memory of Japan, agreed that DRAM supply will be tight through 2004. “Samsung Electronics, Powerchip and Elpida are the only ones that have the ability to have mass production of the wafers next year,” said Eric Tan, a PSC vice president. The company is scheduled to make 35,000 of the wafers per month at the end of 2004, compared with 12,000 currently, he said. ProMOS now is producing 11,000, with 13,500 scheduled for the end of this year, said a company official. Winbond will not have any output of the wafers as it cancelled its plan to build a 12-inch fab. Samsung Electronics and Hynix Semiconductor of South Korea and Boise, Idaho-based Micron Technology have not been able to ramp up their DDR400 production rapidly, adding to the concern about a supply shortage, some analysts said. Last month, the US International Trade Commission (ITC) assessed a 44.71% tariff on all Hynix DRAM products shipped to the US, reducing the South Korean chipmaker’s shipments to the world’s biggest market. The assessment came after the ITC concluded Hynix damaged the US DRAM industry by accepting illegal financial aid from banks related to the South Korean government. ______________________ Source: DigiTimes