May 17, 2006 – Toshiba made big strides in NAND flash sales in 1Q06 to pull away from the pack as the clear No. 2 supplier behind market giant Samsung, according to new data from iSuppli Corp.
Toshiba enjoyed 18% sequential growth in NAND flash sales in 1Q to $801 million — the only company among the top seven NAND flash suppliers to post positive growth during the quarter. Worldwide, the NAND flash market sunk 8% in 1Q06 to $3.2 billion, although that’s better than the 13% iSuppli had earlier predicted. Average selling prices (ASP) for NAND flash were hammered to start the year, plummeting 22.5% during the quarter. Still, the market showed resiliency with a robust 19% unit shipment growth during the quarter, noted Nam Hyung Kim, director and principal analyst with iSuppli, who had earlier expected a 28% decline in NAND ASPs.
“The limited decrease in ASPs and the strong rise in unit shipments show that the NAND flash market was not as bad as many had expected in the first quarter,” he stated. Weak pricing in the spot memory market did not impact the overall ASP to a great degree, he noted, while shipment backlogs and continued strong demand for embedded flash helped compensate for weak demand for MP3 players and removable memory-card markets.
First-quarter sales of NAND flash memory were down 8% sequentially, but were 60% higher year-on-year, making it the fastest-growing product segment in the global semiconductor market. Still, aside from Toshiba — which won a battle of attrition in 1Q06 by keeping its ASP decline to 15% — everyone else suffered. Market-leading Samsung saw sales dip 12% during the quarter and Hynix slumped 20%, as both companies withstood >20% ASP declines. Renesas slumped 19% quarter-on-quarter, followed by Micron (-12%), STMicroelectronics (-9%), and Infineon (-42%), which is shedding its memory business altogether. Year-on-year, the biggest sales increases came from Micron (850%), STMicroelectronics (326%), and Hynix (232%), all of whom have been ramping up operations.
iSuppli also noted that in general, suppliers who focused on a single memory product (either DRAM or NAND) performed better than those who serve both segments. And despite an unexpectedly strong 1Q06, the firm is sticking with its original forecast of a 28% decrease in NAND flash sales for all of 2006.
Preliminary 1Q06 NAND flash memory market share
Ranking by revenues in US $M
COMPANY — 1Q06 sales — 1Q share — 4Q05 sales — 4Q05 share — 1Q06/4Q05 — 1Q06/1Q05
Samsung — 1582.0 — 48.7% — 1802.0 — 50.8% — -12% — 32%
Toshiba — 801.0 — 24.6% — 680.0 — 19.2% — 18% — 61%
Hynix — 481.0 — 14.8% — 600.0 — 16.9% — -20% — 232%
Renesas — 183.5 — 5.6% — 226.0 — 6.4% — -19% — 61%
Micron Technology — 95.0 — 2.9% — 108.0 — 3.0% — -12% — 850%
STMicroelectronics — 81.0 — 2.5% — 89.0 — 2.5% — -9% — 326%
Infineon — 26.0 — 0.8% — 45.0 — 1.3% — -42% — -21%
TOTAL — 3249.5 — 100.0% — 3550.0 — 100.0% — -8% — 61%
Source: iSuppli Corp.