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Tuesday, March 10, 2009

NAND ticks up on netbook strength; DRAM flat on murky supply resolution

As of Friday, NAND contract ticked up another 2-5% for the first half of March.  DRAM contract is stuck.

Taiwan has delayed decision on the multi-company merger of their ailing DRAM companies – higher spot and contract over the last couple of months has bought them some time.  As a result, its likely capex will remain muted due to lack of visibility of the future supply picture.  It also means prices are vulnerable to any one of these struggling companies dumping product on the spot market for cash.  In response to these concerns, Micron (MU) got hammered yesterday, dropping 11%.

Overall demand remains muted.  Netbooks are likely driving the strength in NAND – Sandisk (SNDK) sees little benefit from netbooks directly as their SSD drive efforts have fallen behind the industry.

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