Thursday, October 31, 2019

Memory Market Results for Oct 31 (Trick or Treat) and What’s Normal


Memory Market Results for Oct 31 (Trick or Treat) and What’s Normal
We have the results in from a variety of manufacturers and can state what is going on in the market. We have all the details on individual companies and why they are behaving like they are






Summary:
DRAM: All companies reported higher bit sales and much lower ASPs. Average ASP dropped mid teens  (remember when people thought prices would go up in Q3?). inventory is still pretty high

Reason: manufacturers are trying to get rid of bits, customers are taking advantage of low prices to build inventory. Datacenter/enterprise is back to growth and mobile looked pretty good. Prices dropped much more than costs so margins continue to shrink.

So DRAM is heading to 20% annual bit growth like predicted by everyone. But price drops will mean margins are continuing to drop. But at least DRAM is still making money despite lower margins.

NAND: Micron and Samsung reported higher bit sales on continued price drops. NAND is not a profitable business so prices must rise or flatten to actually make money. WDC reported flat pricing (they were claiming 10% higher prices in July) and Hynix reported mid single digit price increase on modest bits sales. And Inventory is still pretty high

Reason: Companies are behaving differently with respect to how they manage this and how aggressive to be given continued high inventory. You need to lower prices to move inventory. But you need to raise prices to be profitable. You need to move to 96L/12x layer to lower costs. But this increases capex and increase supply. This paradox will all sort out by 2H 2020… but it will be a competition until them.

NAND is a battle between working off inventory and trying to get profitable. Hynix and Samsung are behaving very differently on this. As are Micron and WDC. NAND will hit 40% bit growth as predicted by everyone but the margins are poor.


So what does balanced and normal look like? (Normal will happen in mid to late 2020)

DRAM price drops by 5% per quarter. Bits shipped increase by 5% per quarter. Costs drop by 5% per quarter. Inventory is flat (target is 4-6 weeks at supplier)
NAND price drops by 7% per quarter. Bits shipped increase by 8-10% per quarter. Costs drop by 7% per quarter. Inventory is flat (target is 6-8 weeks at supplier)

PREDICTION: We have data on who will win in this and who has challenges… And what recent Earnings reports mean…. And when inventory will be worked off…. And when Chinese companies will make a difference.  AND We have costs for everyone, so that will help determine winner.

Mark Webb
www.mkwventures.com



Wednesday, October 9, 2019

Preliminary Numbers on YMTC Xstacking 64L 256Gbit Chip



One of our top area of analysis is chip cost for all memory chips and even SOCs/logic chips. We are adding 64L YMTC chip to our report that has costs for all NAND memory from each company from 64L to 1xx layers.









High level Summary:

The chips size takes advantage of xstacking with periphery and array on top of each other. To a first order the chip is similar size to Microns 64L part. The reason YMTC chose chip bonding is to control logic processing and performance separate from array processing on separate wafers and then bonding them together. Having array built on top of the periphery does impact the periphery but Micron and others have been successful doing just that. YMTC claims to get much better NAND performance from the Xstacking process.

The down side is that you have two wafers, the cost to bond them together and the complexity of running a two process system. We will also see how Xstacking works in 8 die and 16 die packages needed for SSDs.

The cost, when mature, is modeled to be 34% higher than Microns 64L CMOS under array part. Since YMTC is not shipping volume yet and the Fab is projected to be less than 10K wafer per month currently, the actual cost is pretty far from maturity. We have the cost today, and how it will track over time as it ramps. We also have 128L projected costs for YMTC (and all other companies). We include die size, wafer costs, wafer yields, die yields, bonding cost and how these change over time.
We also have the business model on how this is still a win for Chinese industry, assuming they can ramp production. And how this impact NAND pricing and markets in the future.


The volume will be very small to start but, assuming the reported information is correct, we should see Xstacking chips in products in the next several months.

Mark Webb



Thursday, September 26, 2019

Top 3 Takeaways from Micron Earnings (and 2 bonus)

Top 3 Takeaways/Questions from Micron Earnings ... and two bonus takeaways from a Intel Presentation











  • Pricing dropped in Micron FQ4/CQ3: DRAM Prices down 20% after Trendforce and various sell side analysts said price was flat. Now there is some offset in timing but flat and down 20% are in way different directions. There is a reason and data to back what happened to Micron in FQ4 on DRAM pricing. They later stated that pricing was starting to climb on NAND although it dropped 8% in FQ4
  • Micron plans very little to no cost reduction in 2020. Repeatedly stated no NAND cost reduction due to conversion to replacement gate. DRAM cost reduction will be less than 10%. DRAM is somewhat expected and not an issue if pricing holds. But no cost reduction on NAND when it is losing money today has some serious implications for Micron in 2020.
  • FQ1 earnings will be less the FQ4. This was a surprise to just about everyone who thought we would get a 2H recovery. Why the drop in a historically good quarter? and this is including 3-5c/share earnings impact of NAND accounting change (BTW there is a good reason Micron is changing NAND depreciation)

2 Bonus items: Intel announced NAND and Optane Roadmap
https://www.anandtech.com/show/14903/intel-shares-new-optane-and-3d-nand-roadmap

  • Intel announced they will have new Optane DIMM Modules "Barlow Pass" in 2020 for servers. This seems pretty soon for a follow on given the delays and slow adoption of Apache pass DIMMS. However it is important to keep new generations coming and Intel sometimes delays new products so maybe it wont step on Apache Pass toes too soon. We have cost models for 1st and second gen Optane memory media. Rumor is that Barlow Pass uses Apache pass memory chip (unverified)
  • Intel announced 144 layer NAND technology with floating gate. Intel and Micron are both going to struggle with their first generation apart..... mainly from a financial point of view. but the fact that Intel is announcing the 1xx layer part for 2020 is good for Intel customers and a welcome surprise for me. I was getting worried Intel would skip the first gen 1xx NAND technology. NAND costs will keep coming down in 2020/2021 ... we have summaries of where each company stands in cost with 96L and 1xx layer.

Lots of new technologies, financial challenges, and we have the macroeconomic challenges too. 2020 will not be a dull year.

Mark Webb


Monday, August 19, 2019

Memory Pricing Update and Models August 2019



One of the most common questions these days is “what will happen on pricing”. No one knows for sure and wild reaction to news articles is adding to the speculation









Some thoughts on pricing models

  • DRAM exchange/ Inspectrum is usually directionally correct, but wrong in magnitude and in absolute numbers when comparing to actual company ASP
    • Spot pricing is open market and not related to what major customers pay
    • Customers react differently in magnitude to increases and decreases in exchange price
    • Even contract price is not REAL contract price and does not match company ASPs
  • Over time prices drop … A lot … in a balanced market, we model 25% per year for NAND and 15% per year for DRAM going forward. This is FAR lower than historical memory pricing (35%+) and matches cost expectations.
  • Actual Pricing is a response to market growth, Inventory, and customer relationships. We can discuss how to track these
  • the number one input to memory company profits is pricing.... so anything they can do (legally hopefully) to get pricing to increase will help memory companies. Unfortunately or fortunately, they are just not very good a collusion! but there are legal tactics that they do all the time.
  • Cost for each company matters. One model is that pricing always drops til at least one company loses money. Today, not all memory companies have the same cost. in 2021, there will be even larger differences in cost with different leaders
Where are we today?:

  • We had a shortage of NAND and DRAM through about Q4 2017 and Q3 2018 respectively. Since then both are in major oversupply. Inventory at customers and suppliers skyrocketed. We can explain why this happened and when it will happen again.
  •  Well publicized supply limitations (power outage, Japanese chemicals, Reduced wafer starts) have people optimistic on pricing. All of these require discussion to see if they matter and how much. Remember: lowering wafers starts is a horrible business idea.... unless you tell everyone you are doing it!
  •  Dramexchange has reported spot NAND price increases, contract price decreases, wafer price increases.  This actually all makes sense. We have input from suppliers and customers and where they see the market and strategies. It is a cyclical market, prices will go up WHEN there is a shortage. We have a model on when this will happen across the board as reported by real companies. We also tell you how to monitor it


So lots of people will report where pricing is today (Dramexchange and Inspectrum are good starts). The key is how to monitor this in the next 3 months, 6 Months, 1 year and 2 years and why each company may not see the same effects. Contact us for more information

Mark Webb
MKW Ventures Consulting







Thursday, August 8, 2019

3D Xpoint Revenue and Bit Output

We presented bit output and revenue projections for 3D Xpoint at Flash Memory Summit this week. See details below











To calculate this, we modeled Fab wafer capacity, factory loading percentage, yields, die size, cost, pricing, etc and how those are projected to change over the next few years.

Charts are below, full presentation is on our website and Flash Memory Summit site. The full details on all of the parameters going into the model are available to clients

GB Output Projections:









3D Xpoint Revenue Projections:











See presentations for more info. Call to set up meeting to discuss monthly updates to 3D XPoint output, revenue, and status on 2nd Generation 3D Xpoint.

Mark Webb
www.mkwventures.com

See ALL Reports at www.mkwventures.com/reports.html




Wednesday, August 7, 2019

What's the Best Approach to Persistent Memory at FMS

I will be hosting a panel session on "What is the Best Approach to Persistent Memory" at Flash Memory Summit, Thursday at 2:10PM in Room GAMR 2. On the Panel we will have


  • Rahul Advani, Netlist, VP Marketing
  • Bill Leszinske, Retired Corporate VP from Intel NVM Solutions Group
  • Arthur Sainio, Smart Modular, Director Product Marketing
  • Pankaj Bishnoi, Everspin, Director of Business Development


We will discuss what the future of Persistent Memory is and what forms it will take. What is the memory, what is the speed, what is the density, how will we access it?

Stop by and bring you tough questions for the panel!

Mark Webb
MKW Ventures Consulting
www.mkwventures.com



Thursday, August 1, 2019

Mark Webb, MKW Ventures at FMS 2019

 I will have a number of presentations at Flash Memory Summit this year. I also look forward to meeting with industry leaders and people who want to develop a better understanding of Memory, Storage, Markets, and which technologies will dominate the next 10 years. I will have updated NAND technology roadmaps and the costs for each company for 2018-2022 and update on where China is positioned in  NAND and DRAM technology.




MRAM Developer Day and Preconference Aug 5th

  • Persistent Memory Preconference seminar: I will present an overview of persistent memory, applications, changes over the past year and my forecast for revenue over the next 5+ years. Persistent Memory is here and is real today Monday 8:30-Noon. Rm 206
  •  MRAM Developer Day: We have a panel of experts presenting what the future of MRAM will be and how we will get there. I like to say that MRAM is a tale of two markets. Embedded and discrete with two sets of success criteria and two sets of challenges Monday 5-6PM Great America Room


Flash Memory Summit Aug 6-8, 2019

  •  PMEM-102-1: Persistent Memory Part 2: Software and Applications Tuesday at 3:40. Market overview of Persistent Memory, Markets, revenue and what is needed to achieve the large CAGR that we are predicting. What has changed in the last year and what has not advanced like we hoped
  • NEWM-102B-1: Annual Update on Emerging Memory Technologies Tuesday at 4.55. Here I will present a 1 hour presentation on the status of multiple new memories. What the advantages and disadvantages are for each. We have lots of new memories that have made progress, we will show where they stand on the Product Lifecycle for NVM. Some are shipping today with billions in revenue predicted. Some are 5-10 years from being in an actual product that you can buy. Bring your question on every memory technology
  • “Chat with Experts Table”  (Tuesday 7PM). I will be hosting the table on 3D XPoint technology. Come ask questions and discuss the breakthrough memory, what is costs, how it is used, how and where it is made and when the competitors will join the fun.
  • NEWM-201-1: 3D XPoint: Current Implementations and Future Trends Wednesday at 8:30AM. I will show new applications in the last year, Costs compared to other technologies, Updated revenue forecast, Bit shipments in 2019 and 2020 including Gen 2 Xpoint, Speed, Endurance. Plus address how development will move forward after the Intel/Micron breakup
  •  PMEM-302A-1: What’s the Best Approach to Persistent Memory Today…and Tomorrow? Thursday at 2:10. I am hosting this panel session with experts on persistent memory to present what the future looks like and how will it change computing.
Call or text to set up a meeting and review the information 1:1

Mark Webb
www.mkwventures.com