Described as a significant drop, it represents the third consecutive quarter where revenues have fallen. According to TrendForce, a closer look reveals that increased shipment volumes were exclusive to Micron, with other suppliers seeing a decrease. The ASP fell for all three major suppliers.
While an enduring oversupply issue, which has led to an ongoing slump in prices, is the chief culprit behind the decline the industry does expect to see a gradual slowing in the rate of price decline following planned production cuts. TrendForce’s Q2 forecast suggests a rise in shipments, but the ongoing price fall might limit potential revenue growth.
Each of the three major suppliers, Samsung, Micron, and SK Hynix, reported a drop in quarterly revenue. Samsung saw a decline in both shipment volumes and ASP due to fewer orders for its newly launched devices, resulting in a QoQ decrease in revenue of 24.7%, amounting to about $4.17 billion.
Benefiting from its earlier financial reporting and the tail-end orders of the previous year, Micron climbed to the second position in 1Q23. Despite being the only supplier among the big three to record positive shipment growth, Micron couldn't avoid a minor 3.8% revenue decline, taking its total down to $2.72 billion.
Among the ‘big three’, SK hynix faced the steepest decline, with more than a 15% drop in both shipment volume and ASP, leading to a drastic 31.7% plunge in revenue, amounting to approximately $2.31 billion.
With DRAM prices continuing to fall, it's anticipated that Q2 operating profit margins will remain in the red. In response to this, all three major suppliers have started implementing production cuts, with Q2 capacity utilisation rates expected to fall to 77% for Samsung, 74% for Micron, and 82% for SK hynix.
Among Taiwanese suppliers, Nanya faced a decline in shipments for the fourth consecutive quarter, with Q1 revenues dropping by 16.7%. Mainstream process nodes remained stagnant at 20 nm, lagging behind the big three, leading to a substantial decline in operating profit margins to -44.9%. However, there is a glimmer of hope as the replenishment demand for TV SoC inventory is anticipated to lift the Q2 utilisation rate back up to 80% from 70%.
Despite receiving several emergency orders for laptops and TVs in Q1, Winbond reported an 8.8% decline in revenues as prices continued to fall. Amidst falling prices and sluggish demand, PSMC experienced a 12.3% dip in its quarterly DRAM revenue. The company's financial performance is primarily tied to its own consumer DRAM products, excluding the revenue from its DRAM foundry services. However, if the foundry service revenue were to be included, the company's quarterly decline would steepen to 22.6%.
