| Samsung Electronics' Pyeongtaek campus / Courtesy of Samsung Electronics |
By Kim Bo-eun
Samsung Electronics secured its lead in the global DRAM (dynamic random-access ram) market by accounting for 42.1 percent of total sales in the fourth quarter of 2020, according to data from market tracker Trendforce. SK hynix accounted for 29.5 percent of global DRAM sales to rank second.
The top two Korean chip makers accounted for 71.6 percent of global DRAM sales.
Samsung achieved 8.4 trillion won ($7.44 billion) in DRAM sales, up 3.1 percent quarter-on-quarter. SK hynix's sales reached 5.87 trillion won, up 5.6 percent from the previous quarter.
"Although Korean suppliers experienced a quarter-on-quarter decline in the DRAM average selling price (ASP), they were able to increase their bit shipment, indicating a recovery in client demand during this period," the report said.
"Samsung and SK hynix both increased their bit shipment by a wider margin than previously expected."
No. 3 player Micron's revenue fell 7.2 percent quarter-on-quarter to 5.57 trillion won, due to a decline in its quarterly bit shipment. Micron's market share subsequently fell by 2 percentage points to 23 percent in the fourth quarter.
Global DRAM revenue reached 19.85 trillion won, up 1.1 percent quarter-on-quarter. Trendforce attributed the growth to the efforts of Chinese smartphone brands such as Oppo, Vivo and Xiaomi to expand procurement activities to seize market shares which became available after Huawei was blacklisted by the U.S.
All suppliers experienced a decline in profits in the fourth quarter of 2020 as a result of the 5 to 10 percent quarter-on-quarter decline in DRAM ASP, Trendforce said.
Samsung's operating profit margin fell to 36 percent in the fourth quarter from 41 percent in the previous quarter. SK hynix also saw its operating profit margin fall to 26 percent in the fourth quarter from 29 percent in the third quarter.
The Trendforce report projected Micron's market share to increase in the first quarter of this year.
"Micron is likely to catch up to its Korean competitors in terms of market share, owing to Micron's pricing strategies, which are the most aggressive among DRAM suppliers, as well as to a general upturn in DRAM quotes," the report said.
Trendforce forecasts DRAM quotes to rebound from a trough, "generating some upward momentum for suppliers' profitability to rebound from rock bottom as well." These events will officially mark the cyclical upturn in DRAM prices, the report said.
"However, as the first quarter of 2021 is the first quarter of an upturn in the DRAM market, and demand is yet to emerge out of the off-season, any growth in bit shipment and prices is expected to be modest, with only a slight quarter-on-quarter increase in global DRAM revenue compared to the fourth quarter of 2020," the report said.