1 Main DRAM and NAND Flash Product Overview
1.1 Memory Industry Overview
Storage is the second largest sub-segment in the semiconductor market. The global storage market size in 2022/2021/2020 was $155.5/153.4/117.5 billion, accounting for 28%/28%/27% of the semiconductor market size, respectively.
Exhibit 1: Proportion of Memory ICs in Integrated Circuits and Semiconductors from 2020 to 2024
1.2 Product Classification
Exhibit 2: Semiconductor Memory Segment Products
Memory ICs mainly consist of DRAM and NAND Flash products, with a market share exceeding 95%. The primary three markets for these products are smartphones, servers, and PCs. DRAM accounts for 39%, 34%, and 13% of the market share in these respective markets, while NAND Flash accounts for 37%, 18%, and 28% of the market share.
1.3 Main Manufacturer
The memory chip industry is dominated by Korean and American manufacturers. Among the top-tier storage IC manufacturers are Samsung, Micron, SK Hynix, Kioxia, WD, Nanya Technology, and Huabang Technology. Looking at market share, Samsung leads the DRAM category with a 40% share, followed by SK Hynix and Micron at 29% and 22%, respectively. These three companies collectively control more than 90% of the DRAM market, essentially monopolizing it. Similarly, in the global NAND Flash market, Samsung remains the leader with over 30% market share.
At a technical level, Samsung Electronics, SK Hynix, and Micron are heavily investing in research and development for 10nm process DRAM, including fourth-generation (1α nm) and fifth-generation (1β nm) versions. This investment aims to produce high-end memory products such as HBM, DDR5, and low-power LPDDR5.
Regarding process node development, the three DRAM giants progressed from the 1X stage (16nm-19nm) in 2016-2017 to the 1Y stage (14nm-16nm) in 2018-2019, and then to the 1Z stage (12nm-14nm) in 2020. Over the past few years, they have advanced further to 1α (about 13nm), 1β (10nm-12nm), and 1Y (about 10nm, an enhanced version of 1β) process technologies. Compared to 1α, the 1β process improves energy efficiency by approximately 15% and memory density by more than 35% at a 16Gbit capacity.
2 Supply Side: DRAM and NAND Flash Key Index
2.1 Price Trend
As of the end of September 2023 (23Q4), DRAM prices had hit their lowest point and started to rebound. By the end of February 2024, the main DRAM product series, DDR4, showed a noticeable growth trend.
Exhibit 3: DDR4 Product Price and Trend
Entering March 2024, DRAM prices have entered a consolidation period due to the limited demand from end-users, resulting in restrained price increases. Nevertheless, based on the ongoing efforts by suppliers to control supply and support prices, the overall trend of price increases is expected to remain stable.
Exhibit 4: DRAM Main Product Price Trend ($)
NAND Flash spot prices have been steadily rising, primarily starting from 23Q4 onwards. Taking the example of a 256 GB 32Gx8 MLC module, the spot price hit its lowest point in July 2023 at $11.15. Since then, it has been gradually increasing until March 4, 2024, when it reached $11.48, showing a slight upward trend.
Exhibit 5: NAND Flash Main Product Price Trend ($)
In early and mid-March of this year, the overall spot price movement for NAND Flash was more favorable than for DRAM. Towards late March, both NAND Flash and DRAM experienced a slight decline in prices due to weak end-user demand, marking a phased adjustment. However, overall, prices for both NAND Flash and DRAM are expected to steadily rise throughout 2024.
According to forecasts from the World Semiconductor Trade Statistics (WSTS), the memory chip market is projected to grow by 44.8% year-on-year in 2024, reaching a market size similar to that of 2022 at $130 billion.
