In recent times, the massive buzz throughout industries has been across the energy of synthetic intelligence, with some critics elevating issues about AI exacerbating the digital divide.
The facility of AI is felt none the weaker within the semiconductor business as AI is making a DRAM divide between hot sellers and laggards among the many reminiscence chipmakers.
Whereas server DRAM is booming, with its costs rising on account of robust demand for AI-powered units, costs of DRAMs for PCs and smartphones are dropping.
The value hole between conventional DRAMs and cutting-edge new merchandise equivalent to high-bandwidth memory (HBM) can also be widening.
Based on market analysis agency DRAMeXchange on Wednesday, costs of server DRAM modules, equivalent to double information charge 5 (DDR5) 64 GB RDIMM, have elevated by 1-2% from the earlier month.
Against this, the contract worth of PC DRAM modules equivalent to DDR5 16 GB SO-DIMM remained unchanged. The value of some PC DRAM chips contracted final month fell by 10-22%.
Whereas main tech corporations equivalent to Google Inc. and China’s Baidu proceed to spend money on servers, resulting in regular server DRAM demand, gross sales of PC DRAM chips have stalled, business information confirmed.
RISING TECH FACILITY INVESTMENT
Based on Bloomberg Information, 13 giant international tech corporations’ facility investments for fiscal 2024 stood at $231.4 billion as of Aug. 26 – a slight improve from $230.8 billion tallied in early August. Their investments are forecast to develop 17% for fiscal 2025.
Whereas PC producers are aggressively launching AI-applied merchandise, nonetheless, market reactions have been lukewarm.
Market analysis agency TrendForce lately revised down its forecast for PC DRAM worth will increase within the fourth quarter to flat from a hike of 3-8% it projected in September.
NEW CHIPS SOAR, OLD CHIPS DIVE
The value hole between the most recent DDR5 and its older model, DDR4, can also be widening.
Based on Seoul-based Meritz Securities Co., the worth of DDR5 DRAM modules for PCs was 29% increased than that of DDR4 within the third quarter – wider than a 26-percentage hole within the second quarter.
The widened worth hole was largely on account of elevated DDR4 chip manufacturing by China’s ChangXin Reminiscence Applied sciences (CXMT), in keeping with business officers.
CXMT’s month-to-month DRAM manufacturing capability has expanded to 160,000 sheets when it comes to wafer, from 40,000 sheets in 2020. The Chinese language firm is at present the world’s No. 4 DRAM maker.
Its month-to-month manufacturing capability is forecast to rise to 200,000 sheets by the top of this yr and additional to 300,000 sheets by the top of 2025.
REBALLING CHIPS
Korean reminiscence chipmakers are additionally identified to be contributing to the drop in DDR4 costs by promoting recycled chips, referred to as “reballing chips.”
Often known as reball chips, such semiconductors are made by recycling discarded reminiscence modules. Though much less worthwhile, reballing chips assist increase chipmakers’ gross sales.
TrendForce mentioned low-priced DDR4 reballing chips are extensively accessible within the spot market.
EARNINGS DIVIDE BETWEEN SAMSUNG, SK HYNIX
AI chips are additionally creating an earnings divide between the world’s two largest reminiscence chipmakers – Samsung Electronics Co. and SK Hynix Inc.
The market consensus of SK Hynix’s third-quarter working revenue is 6.85 trillion received ($5.19 billion), down 3.5% from a consensus forecast of seven.1 trillion received a month earlier.
Samsung, in the meantime, is forecast to publish an working revenue of 11.23 trillion received within the third quarter, a 17.8% lower from a consensus forecast a month earlier.
Analysts mentioned the smaller downward changes for SK Hynix have been as a result of greater than half of its sales revenue comes from HBM and different high-value server DRAMs.
Samsung has a comparatively increased proportion of smartphone and PC DRAMs.
Samsung’s third-quarter earnings will even be weighed by the delay in supplying the latest HBM chips to Nvidia Corp. and 1.5 trillion received in one-off costs associated to worker efficiency bonuses, analysts mentioned.
Write to Jeong-Soo Hwang at hjs@hankyung.com
In-Soo Nam edited this text.