According to TrendForce analysts, in the first quarter of 2021, the demand for RAM was unexpectedly high. Leading companies have significantly increased the supply of memory, which did not prevent them from raising prices for these products. As a result, the revenue of memory manufacturers in the first quarter grew by almost 10%. But the process did not stop there. In the second quarter, both revenue and volumes will make another upward leap.

As we have reported more than once, and analysts are talking about it again, four main factors contributed to the growth of memory: remote work, distance education, the redistribution of the smartphone market after Huawei was included in the US blacklist and the growth of server services. All this together allowed manufacturers to increase the average sales price of memory and products based on it, even against the background of a certain increase in production volumes. In general, revenue of memory manufacturers for the quarter increased by 8,7% compared to the fourth quarter of last year and reached $ 19,2 billion.

All of these trends will expand in the second quarter of 2021, analysts warn, and will also be exacerbated by the fact that storage space is rapidly depleting. Thus, they predict that revenue of manufacturers of memory in the second quarter will rise by another 20% in the quarter. This will happen both by increasing the volume of supplies and by increasing the selling prices for products.

Going back to the first quarter of 2021, we note that Samsung’s revenue increased sequentially by 8,5%, SK Hynix’s revenue grew 6,9%, and Micron’s revenue climbed 9,6%. It is easy to see that Micron has grown stronger than the others, although in principle the distribution of market shares has not changed.

Samsung remains the most profitable memory manufacturer. Samsung’s DRAM chip production profitability was 34% in the first quarter, slightly less than in the previous quarter (36%). At SK Hynix, profitability for the quarter increased from 26% to 29% (due to the transition to new technological processes). Micron’s production profitability also increased, from 21% to 26%.

All three leading manufacturers of DRAM chips, analysts say, plan to increase production volumes both by expanding new capacities and by canceling the transition to other products. A number of Samsung and SK Hynix lines were remade for the production of image sensors. This process will now be suspended as memory has become very profitable to release again. However, the new facilities will start producing products in a year or a little later, so you shouldn’t count on them yet.

As for the Taiwanese memory manufacturers, they have benefited even more from the increase in demand and prices than the leading companies, since in many respects they produce specialized microcircuits, the prices of which began to rise in the first place.