Thursday, February 6, 2020

Top Memory/Storage items from Recent Earnings

We had earnings announcements from Seagate, WDC, Hynix, Samsung, WDC, STX, Intel, AMD and others. Lots of new data and predictions for you. 2020 is not going to be dull.

  • Everyone says memory cycle downturn has ended. But how fast will we recover and how good will it get? Will DRAM prices skyrocket? Should we party like its 2018? 
  • Supplier inventories are “near” target (except for Micron who is stockpiling for NAND overhaul). Now FINALLY we have a fair starting point for pricing discussions and supply agreements. And customers need to plan their inventory level targets.
  • Speaking of customers…. Datacenter Giants (not to be confused with the Datacenter Dinosaurs who also exist) will buy and build big…. Then take a hiatus and digest the infrastructure build much to the dismay of CPU and memory companies… then build again.
  • Everyone’s 2020 bit demand growth is approximately aligned (within 5%) but is the number good or bad for EPS growth?
  • WDC and STX are making more money on HDD and the technology is marching on. At this rate, HDD bit ASP will be ZERO by 2025 (just kidding, I should have used a log graph). But we ARE poised to have the SSD to HDD bit price ratio INCREASE just like in 2017.
  • Optane DC persistent memory (DIMMS, 3D XPoint)  IS  cheaper than DRAM and has great performance….  but is still growing slower than expected despite Intel success in Cascade Lake ramp. When will this change? When will CXL help here? 
  • New DRAM and NAND memory technologies are coming out and how they achieve cost reductions is different for each company. The NAND cost leader will change in 2020
  • China Virus and trade issues will either hurt or help memory manufacturers depending on who you ask. We predict the average of those two scenarios!

Mark Webb