Nanya Technology, currently Taiwan's top DRAM maker by revenues, has expressed concerns that it may see ASPs drop sequentially in the first quarter of 2010 due to weakness in DDR2 contract prices. The company's ongoing transition to 50nm process technology will also not be able to offer any significant contribution to its profitability until the second quarter.
Nanya swung to profits in the fourth quarter of 2009, but said it has not walked out of the shadow of having been unprofitable during the previous 10 quarters. Output for the first quarter will remain similar to the previous quarter's level, but ASPs may edge down due to a downward price corrections for DDR2, Nanya explained.
Spot market quotes for DDR2 chips have gone down by around 20%, which is likely to drive down contract prices in February, industry sources in Taiwan generally believe. average prices for 1Gb DDR2 have fallen below US$2.30, whereas the 1Gb DDR3 segment averaged above US$3.
In addition, Nanya said its readiness to ramp up output of 2Gb DDR3 chips will reflect in its financial figures starting from the second quarter, implying ASPs will not be able to sustain its first-quarter profitability.
Nanya expects to run its 12-inch fab at full capacity in March, and start using 50nm processing to produce DRAM in the second quarter, the company was quoted in previous reports. Its monthly capacity will then exceed the present level of 30,000 wafers.