MEMORY INDUSTRY - MARKET UPDATE

NAND consolidation, China’s bet on two key players, the rise of the CXL interface… Memory business keeps growing

Amid the pandemic, trade-war tensions, and chip shortages, the memory market outlook remains bright, to reach more than US$180 billion in 2022.

Extracted from: 
•  Status of the Memory Industry report, Yole Développement, 2021
•  DRAM Quarterly Market Monitor, Q2 2021, Yole Développement
•  NAND Quarterly Market Monitor, Q2 2021, Yole Développement


OUTLINE:

  • Market forecasts & trends:
    Combined DRAM and NAND revenue in 2020 was US$122 billion, up 15% from 2019.
    NAND and DRAM are commodity products and are used, respectively, as storage and working memory for smartphones, SSDs, PCs, servers and vehicles…
    DRAM and NAND represent 96% of the stand-alone memory markets.
    DRAM and NAND revenues are expected to grow with 15% and 8% CAGR2020-2026 respectively.
    The pandemic had a mixed impact on the memory industry datacenter and laptop demand grew, automotive and smartphones faced a slowdown.
    Thanks to a combination of CAPEX cuts from suppliers in recent years and flourishing demand, the future is looking bright, particularly for DRAM.
  • Products’ evolution:
    In 2020 the leading 3D NAND manufacturers have been ramping up the new 1xxL generation…
    In parallel, following Micron, Samsung and SK hynix have been ramping up 1z DRAM technology.
    The processor memory interface is rapidly evolving to meet the demands of emerging data intensive applications: memory sizes must increase, while the bandwidth between memory and the CPU must grow.
  • Supply chain:
    The consolidation of the NAND market has started with the acquisition of Intel’s 3D NAND business by SK hynix.
    The DRAM oligopoly of Samsung, SK hynix, and Micron remained largely unchanged in 2020, with Samsung being the undisputed lea der with up to 42% market share.
    The Chinese efforts to develop a local semiconductor memory industry narrowed down to 2 key players: YMTC and CXMT.
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“NAND and DRAM are the workhorse memory technologies,” says Simone Bertolazzi, PhD. Senior Technology & Market analyst at Yole Développement (Yole).“They are used, respectively, as storage and working memory for a broad spectrum of applications and systems, including smartphones, tablets, SSDs, PCs, servers, and vehicles.”
The market research and strategy consulting company, Yole announced a combined DRAM and NAND revenue rose 15% from 2019, reaching about US$122 billion in 2020.

Mike Howard, VP of DRAM and Memory Research at Yole explains: “Thanks to a combination of CAPEX cuts from suppliers in recent years and flourishing demand, the future is looking bright, particularly for DRAM. Revenues will peak again in 2022, reaching record-high values of US$122 billion (DRAM) and US$77 billion (NAND).”
In the long term, DRAM and NAND revenues are expected to grow to US$86 billion (NAND) and US$151 billion (DRAM) with CAGR20-26 of about 15% and 8%, respectively. In the same period, the ASP is expected to decrease by ~5% (DRAM) and ~16% (NAND), driven by cost-per-bit reductions enabled by technology scaling.
Walt Coon, VP of NAND and Memory Research at Yole adds:
“Both the DRAM and NAND markets are cyclical in nature, as they are characterized by periods of shortages and oversupply that give rise to strong price variations and revenue volatility.”
After substantial oversupply in 2019 – with ASPs down 49% year-over-year for both NAND and DRAM – overall market conditions improved in 2020 despite trade-war tensions and the outbreak of Covid-19. The pandemic had a mixed impact on the memory industry: data center and laptop demand grew, automotive and smartphones faced a slowdown. The net outcome has been a relatively balanced memory demand, while NAND/DRAM production started slowing down as memory suppliers significantly underinvested in new wafer capacity. (1)

“In the present semiconductor shortage era, the storage-drive industry is facing a scarcity of SSD controllers and other NAND sub-components, which causes supply chain uncertainty and puts pressure on ASPs,”comments Simone Bertolazzi from Yole. And he adds: “The recent shutdown of Samsung’s manufacturing facility in Austin, which manufactures NAND controllers for its SSDs, further amplifies this situation and will likely accelerate the NAND pricing recovery, particularly in the PC SSD and mobile markets where impacts from controller shortages are most pronounced.”

Yole investigates disruptive memory technologies and related markets in depth, to point out the latest innovations and underline the business opportunities. Its memory team has been following the memory industry for a while. Yole proposes two types of analyses, reports and quarterly market monitors to deliver a deep understanding of the market evolution, technology trends and the market positioning and strategy of the leading memory companies.
Today, Yole is pleased to announce its Status of the Memory Industry report, 2021 edition. It delivers an in-depth understanding of the memory ecosystem and key technical insights. This new report analyses future technology trends and challenges. Including market trends and forecasts, supply chain, technology trends, technical insights and analysis, take away and outlook, this study also delivers an in-depth analysis of the ecosystem and main players’ strategies.
In addition, all year long, memory analysts follow the market evolution, quarter after quarter, and propose the Yole’s NAND Quarterly Market Monitor and DRAM Quarterly Market Monitor. Both monitors are updated and published every beginning of March (Q1), June (Q2), September (Q3) and December (Q4). Aim of these services is to provide an in-depth coverage of rapidly changing market dynamics and main players’ status and strategy.

What is the status of the memory industry, today? What are the economic and technological challenges? What are the key drivers for each market segment, NAND and DRAM? Who are the players to watch, and what innovative technologies are they working on? Yole presents today its vision of the memory industry.

The memory-processor interface is key for overcoming the “memory wall”, announce Yole’s Memory analysts. CXL and DDR5 will enable the new wave of data-intensive applications…
The processor-memory interface is rapidly evolving to meet growing performance needs from data intensive applications, which are being hampered by the so-called “memory wall”, a bandwidth limitation associated with data transfer between the memory and the processing unit.
DDR5 DRAM is the latest updated to the DDR standard and will significantly boost performance compared to DDR4. The new specification brings lower voltage and moves PMICs onto the memory module. It doubles the maximum data rate and increases the die density by a factor of 4 (up to 64Gb).
The production of DDR5 memory is now gaining momentum, with all leading DRAM manufacturers having already finalized their mainstream DDR5 designs:
• SK hynix announced that they are ready to start shipping DDR5 memory to module manufacturers.
• Micron announced sampling of DDR5 memory based on the 1znm technology, targeting RDIMMs for servers.
• The DDR5 memory standard will be utilized by upcoming Intel’s server CPUs
• Regarding AMD, its platforms are expected to be launched later this year.
“At Yole we expect a veritable takeoff of DDR5 will occur from 2022”,points out Simone Bertolazzi from Yole.

Besides DDR, a variety of new open interfaces and protocols are currently in the works: CXL, Gen-Z, OpenCAPI, CCIX. Among these, CXL is picking up momentum in data center applications, providing a sweet spot – in terms of capacity and density – for connecting high-capacity DRAM and SCM technologies such as 3D XPoint. The Status of the Memory Industry 2021 report provides an overview of DIMMs, SSDs, and interfaces. This report marks the beginning of Yole’s systematic investigations in the field of memory modules and storage drives.

All year long, Yole Développement publishes numerous reports and monitors. In addition, memory experts realize various key presentations and organize key conferences.

For example, do not miss to watch the Live Market Briefing: DRAM & NAND Memory markets show building strength – Could we be entering the next supercycle?
During this digital event, Yole explored what the next few quarters and years hold for both the NAND and DRAM markets, including demand, pricing, and profitability. Watch the replay now!

Make sure to be aware of the latest news coming from the industry and get an overview of our activities, including interviews with leading companies and more on i-Micronews.
Stay tuned!

Acronyms:
ASP: Average Selling Price
DDR: Double Data Rate
PMIC : Power Management ICs

Note:
(1)These market figures are well detailed and analyzed in DRAM & NAND Quarterly Market Monitor, Q2 2021.



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