Market Insight

Nanya and Inotera Q4 losses no surprise


Both Nanya and Inotera reported losses on Monday - a reflection of the dismal quarter experienced by DRAM pricing. It comes as no surprise to IHS iSuppli that earnings moved negative as DRAM pricing for the fourth quarter was horrific. Commodity DRAM pricing (DDR3) dropped precipitously during the quarter and those manufacturers heavily exposed to DDR3 (e.g. Nanya and Inotera) felt the full impact of those free-falling ASPs. Both Nanya and Inotera enjoyed dramatic growth in shipments in the fourth quarter (35% and 66% respectively) but this rise in shipments came too late. Had the boost in shipments happened earlier in the year, when prices were actually increasing, then the two companies would have enjoyed a much more profitable 2010. The silver lining to the Q4-10 results is that it looks as though Inotera has finally overcome the 50nm production challenges it faced all of 2010.