Although DRAM makers are improving production yields, which should raise demand for backend services, the possible drop in memory packaging quotes is expected to slow Taiwan-based memory backend houses' revenue growth in the fourth quarter.
The memory packaging and testing firms reportedly are now facing price-cutting pressure from some DRAM chipmakers, which intend to minimize the impact of DRAM price falls on their profitability.
But Powertech Technology (PTI) said that its current quotes for memory chips remain stable. The company is projecting consolidated revenues for the fourth quarter to be within its guidance of 5-7% sequential growth.
PTI is a major backend service provider for DRAM vendor Elpida Memory, which has increased manufacturing outsourcing to Taiwan-based Rexchip Electronics and ProMOS Technologies.
Fellow memory backend company Walton Advanced Engineering expects fourth-quarter revenues to grow slightly on quarter. The company said rising orders will drive its sales to another historical record in the fourth quarter, despite lower quotes it may offer.
Winbond Electronics, Powerchip Technology and Nanya Technology are among Walton's major DRAM customers.