Memory-IC packaging and testing specialist Walton Advanced Engineering expects its revenues to drop by another 5-10% sequentially in the first quarter following an almost 20% sequential decline in the fourth quarter of 2011. The company attributed its pessimistic view to the dismal DRAM industry.
Walton revealed its capacity utilization rate slipped to 60-70% in the fourth quarter from 75-80% in the third, as DRAM clients scale back their output to stop prices falling further.
Elpida Memory, Nanya Technology and Powerchip Technology reportedly are among Walton's major DRAM clients.
But looking forward, demand for standard DRAM is expected to start recovering after March, Walton said. Meanwhile, orders for new mobile DRAM products are also likely to pull in, the firm added.
In addition, Walton noted that the proportion of standard DRAM products in company revenues has slid to 50% while that of mobile DRAM rose to 10%. Niche-market memory accounts for the remainder. The breakdown is in line with customer needs, the company said.
Walton also provides backend services for Winbond Electronics, which supplies NOR flash memory chips as well as niche-market DRAM products such as specialty DRAM for consumer electronics and mobile RAM for handsets.
In other news, fellow company Powertech Technology (PTI) also holds a conservative view toward its business in the first quarter of 2012. Company chairman DK Tsai was quoted as saying in previous reports that PTI's consolidated revenues would see a 10-15% sequential decrease in the first quarter. However, Tsai noted that chipmakers' ongoing efforts to cut back production will help the industry return to a healthier supply-demand dynamic despite negative effects in the short term.