2014 NAND Flash Market Update - TrendForce1H14 Weaker OEM and retail market results in over-supply...

2014 NAND Flash Market Update -Supply, Demand and Beyond-

Sean YangJune 5th , 2014

Memory and Storage Division

June, 2014 |ALL RIGHTS RESERVED. REPRODUCTION PROHIBITED WITHOUT WRITTEN PERMISSION.

Supply, Sufficiency and ASP


-

5

10

15

20

25

30

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014E

31%60%

7% 23%

-18%

14%51%

16%-7%

19% 5%

Source: DRAMeXchange,June2014

NAND Market Revenue Trend

USD$bn

NAND Revenue Growth.(%)

� 2014 NAND market revenue continues to grow with solid demand from diversified applications.

External Drive/ Consumer Embedded Drive/ ICT Storage


-

10,000

20,000

30,000

2007 2008 2009 2010 2011 2012 2013 2014E

Bit Supply Shipment Bit Demand Shipment

� 2014: Supply growth @38% YoY, Demand grwoth@39% YoY.� NAND makers are profit-oriented and conservative toward supply strategy.� Supply & Demand balance is a new paradigm.

Unit: 2GB M equiv.

1.8%

12.3%

-0.2%

1.3% 5.8% 6.0% 2.6% 1.9%

2014 NAND Market: Balance is the Theme



CAPEX: DRAM vs. NAND NAND Flash CAPEX

� 2014 CAPEX : US$9.2 Bn with 15%yoy , mostly reserved for 3D-NAND in the future.� Memory CAPEX is US$15-16 Bn level, allocation favor on NAND.

-60%

-20%

20%

60%

100%

0

2,000

4,000

6,000

8,000

10,000

12,000

2008 2009 2010 2011 2012 2013 2014E

Unit: US$M

-

5,000

10,000

15,000

20,000

25,000

2008 2009 2010 2011 2012 2013 2014E

DRAM CAPEX

NAND Flash CAPEX

Unit: US$M

CAPEX: Preparation for 3D-NAND Era



-8%

-4%

0%

4%

8%

12%

16%

20%

0

5,000

10,000

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14F 4Q14F

Supply Volume Demand Volume Sufficiency Ratio

Unit: 2GB M Equiv.

� 1H14 Weaker OEM and retail market results in over-supply pattern.� Momentum from new OEM demand helps to ease S&D imbalance in 2H14.

New iPhone (4.7)Samsung Note4China Smartphone

New iPhone (5.5)iWatchNew Macbook

2014 Quarterly Sufficiency



$-

$1

$2

$3

$4

$5

$6

32Gb MLC TSOP-Channel64Gb MLC TSOP-Channel

$5

$10

$15

$20

$25

$30

$35

$40 16GB eMMC 32GB eMMC

$50

$100

$150

$200

$250

$300

$350

128GB SSD 256GB SSD� Embedded (eMMC, SSD) price stably

declined QoQ, mostly reflecting cost down from migration.

� Channel chip price is the mix of market supply and demand.

ASP Trend: Different Pattern for OEM and Channel



-

1,000

2,000

3,000

4,000Samsung Toshiba/SanDisk

SK Hynix Micron/Intel

Others

Unit: KPCs,12”equiv.� 2014 NAND capacity +8% YoY.

� Hynix NAND capacity will be fully recovered from 142Q (150k/m).

� Micron Singapore fab transition will be completed, total Micron/Intel NAND capacity is up 235k/m from 142Q.

� Toshiba Fab5 Phase2 infrastructure is set from 14Q3, equipment installation from 14Q4.

� Samsung Xian fab and 3D-NAND schedules fall behind.

NAND Capacity: Added Slightly for 2014



0%

10%

20%

30%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14F 4Q14F

0%

10%

20%

30%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14F 4Q14F

0%

10%

20%

30%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14F 4Q14F

-20%

-10%

0%

10%

20%

30%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14F 4Q14F

� Bit output is strongly driven by 1ynm embedded adoption and 1znm-class migration from 2H14.

2014 Bit Output: Derived from Node Migration more



� Supply bit growth is 7-year-low level.� Market Share: SEC@37%, TSB/SNDK@35%, MU/INTL:@17%, Hynix:@10%� Rational supply strategy is predictable under game theory.

-

5,000

10,000

15,000

20,000

25,000

30,000

2008 2009 2010 2011 2012 2013 2014E

Unit: 2GB M equiv.

Bit Supply Trend Market Share (Production Base)133%

54%

80% 75%59%

41%38%

0%

20%

40%

60%

80%

100%

2008 2009 2010 2011 2012 2013 2014EOthers Micron/Intel SK Hynix Toshiba/SNDK Samsung

Supply Dynamics: Limited Growth &Constant Share



� Operating profit margin stabilization is challenging.� SSD, eMMC and eMCP margin >card, UFD.� Customer and product portfolio is the key to margin management.

-10%

0%

10%

20%

30%

40%

1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

Samsung-NAND SK Hynix-NANDMicron-NAND Toshiba-NAND

NAND Financials : Profitability Remains but Squeezing



0%

20%

40%

60%

80%

100%


90nm 6X & 7X nm 5Xnm 4Xnm 3Xnm 2xnm 20nm-Class ≤1xnm-Class 3D-NAND

� Samsung full lineup for 19nm eMMC, eMCP and SSD is ready in from 1Q14. � Toshiba & SanDisk 1ynm eMMC MP schedule is in 142Q.� Hynix 16nm eMMC MP schedule is in 142Q.� Mostly 1xnm-class SSD for PC schedule from 14Q13. � 3D-NAND (%): <2% in 2014

Migration: 1xnm-class Embedded is through 2014, Limited Exposure for 3D-NAND



-

20

40

60

80

100

120

140

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014E 2015F 2016F 2017F 2018F

� 2D-NAND migration comes to bottleneck from 2015 (1znm is the last generation).� 1znm node will be paralleled to 3D-NAND in 2015 and 2016.

Tech Node

128Gb3xnm

24 Layers

256Gb2xnm

32 Layers

1024Gb1xnm

xx Layers

Company MP Time Schedule

Samsung ~2H14

Toshiba/SanDisk ~2H15

SK Hynix ~2H15

Micron/Intel ~2H15

3D-NAND is the Next Super Star



0%

20%

40%

60%

80%

100%

128Gb

64Gb

32Gb

16Gb

8Gb

<8Gb

� 128Gb portion is up to 25% in 4Q14 and cost-efficient in 1znm node production. � SSD requires 128Gb or higher chip for larger capacity design. � Enterprise-SSD content per box reaches ~600GB in 2014.

Density: SSD and Node Migration Drives Density



0%

20%

40%

60%

80%

100%


SLC MLC TLC

1. TSB & SNDK TLC-embedded2. SEC TLC enterprise-SSD

Hynix and Micron is ready for TLC

� 3-bits-Cell eMMC, eMCP and SSD are the next drivers for client OEMs. � Samsung is pioneering 3-bits-cell SSD for enterprise market from 14Q3.

Technology: 3-Bits-Cell Embedded is the Key



2013 2014 2015

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

Roadmap for 3-Bits-Cell Schedule

3-Bits-Cell eMMC/eMCP


3-Bits –Cell eMMC/eMCP

3-Bits –Client SSD

3-Bits –Cell Enterprise SSD

3-Bits-Cell Clint SSD

3-Bits –Cell eMMC/EMCP

3-Bits –Cell Cliient SSD


3-Bits-Cell Clint SSD

3-Bits -Cell Client SSD

� Samsung is introducing full lineups for 3-Bits-Cell embedded products from 14Q3.� Other NAND makers 3-Bits-Cell products will be unveiled from 2Q14

Source: Company data, complied by DRAMeXchange,June2014


0

100

200

300

400

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F

Unit: K/M

� 2014 target bit growth:40%YoY � Xian-An Fab production has been initiated from 1Q14 and dedicated on 3D-NAND. � TLC-basis eMMC and SSD is the key in 2014. � Strength: Strong leverage with Samsung smartphone and tablet.

Product MixCapacity

0%

20%

40%

60%

80%

100%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F

TLC MLC SLC

NAND Flash Vendor Review-Samsung



Unit: K/M

Product MixCapacity

� 2014 target bit growth:35%YoY � Fab5 Phase2 infrastructure will be completed in 3Q14 for 1znm and 3D-NAND.� TLC-Basis embedded products are scheduled from 3Q14. � Toshiba is seeking more engagement with more 1st-tier OEMs. � SanDisk targets >25% SSD revenue contribution in 2014, strongly focus on enterprise-

SSD.

NAND Flash Vendor Review-SanDisk/Toshiba

0

100

200

300

400

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F0%

20%

40%

60%

80%

100%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F

TLC MLC SLCSource: DRAMeXchange,June2014


Product MixCapacityUnit: K/M

� NAND capacity is recovered to normal level (150k/m) from late 1Q14.� In-house eMMC and SSD controller is the key to embedded product success. � TLC-basis eMMC and SSD schedule to ramp from 2H14.

NAND Flash Vendor Review-SK Hynix

0

100

200

300

400

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F

0%

20%

40%

60%

80%

100%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F



-

100

200

300

400

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F

Product MixCapacityUnit: K/M

� 2014 target bit growth:45-50%YoY.� Singapore fab fabrication transition to NAND will be completed in 142Q.� Next generation mobile embedded will catch up from 4Q14 when Elpida mDRAM

and new controller is fully utilized. � Intel positioned itself as a enterprise-SSD technology enabler in the field.

NAND Flash Vendor Review-Micron/Intel

0%

20%

40%

60%

80%

100%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14 4Q14F



Demand and Applications


0%

20%

40%

60%

80%

100%

2009 2010 2011 2012 2013 2014E

Unit: 2GB M equiv.Demand Bit Volume

Handset

Tablet

SSD

Demand by Application

0

5,000

10,000

15,000

20,000

25,000

30,000

2009 2010 2011 2012 2013 2014E

� Demand catalyst continues with strong mobile and enterprise applications. � SSD is #No.1 growth driver in 2014.� Smartphone+ Tablet+ SSD consumes ~80% of total NAND.

NAND Demand Outlook



0

5,000

10,000

15,000

20,000

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14F 4Q14F

Others Vol. Samsung Vol. Apple Vol.

� Apple and Samsung have series of new product launch at from143Q. � Demand bit growth from Apple and Samsung outperforms market average in 3Q14,

significantly helps to ease the market imbalance. � Apple and Samsung steadily consume ~30% of total NAND.

Unit: 1GB M Equiv.APPL: iPhone6, iPad, iWatchSEC: Note4, new SSD

APPL: iPhone 6 (5.5”)

+21%

+14%

NAND Demand: Apple and Samsung



0

5,000

10,000

15,000

20,000

25,000

30,000

2011 2012 2013 2014E

-Total NAND Demand --eMMC Demand-

Unit: 2GB M equiv.

10%16%

23%

25%

eMMC Consumption(%)

Smartphone

Tablet

Consumption by Application

� eMMC market grows along with solid mobile devices.� Middle/Low –end models stifles eMMC content per box.

Shipment by Density

eMMC Market Outlook

0%

20%

40%

60%

80%

100%


0%

20%

40%

60%

80%

100%


64GB

32GB

16GB

8GB

4GB

2GB



0

20

40

60

80

100

1Q12 3Q12 1Q13 3Q13 1Q14 3Q14F

Unit: Million

0

100

200

300

400

1Q12 3Q12 1Q13 3Q13 1Q14 3Q14F

Unit: Million

36%

43%

51%

63%

64%

65%

70%

71%

74%

76%

80%

81%

eMMC % in Smartphone

24%

20%

46%

48%

46%

53%

59%

52%

58%

58%

59%

60%

eMMC % in Tablet

eMMC in Mobile Device: A Common Standard


� eMMC is widely adopted for better performance and advanced O.S.� eMMC is storage standard for major AP vendors. � Apple use pure NAND only.


0

100

200

300

400


High-end Smartphone Middle-end Smartphone Low-end Smartphone

Unit: Million

Smartphone: Weak 1Q14 and Low-End Drives 2Q14

� 1Q14 smartphone drops 6%qoq for seasonality. 2Q14 pick-up from low-end models. � Middle/Low-end models are carrying the catalyst in 2014. (60% in 2013-80% in 2014)



0

100

200

300

400


Smartphone in eMMC Smartphone in MCP Smartphone in Discrete NAND

Unit: Million

� Slowing eMMC content growth is attributed by middle-low end devices.� Traditional MCP is replaced by eMMC or eMCP for new Android O.S and apps.

eMMC is Penetrating from Top to Bottom



0

25

50

75

100

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14E 3Q14F 4Q14F

Tablet in eMMC Tablet in Discrete NAND-White Box Tablet in Discrete NAND

Unit: Million

� 1H14 tablet demand is muted, only 2%HoH compared with 1H13. � Overall demand picks up from 3Q14 for new models unveiled. � Tablet eMMC content declined in 2014 due to ultra-low price tablet raise. � Raw NAND is still popular among Chinese white-box for cost concern.

Tablet: Market Continues to Raise with Limited Content Growth.



2013

Samsung

SanDisk

SK Hynix

Toshiba

Micron

Kingston

Others

770mn eMMC units

Vendor Controller House

Samsung(19nm) In-House

SanDisk(19nm) In-House

SK Hynix(20nm) SMI

Toshiba(19nm) In-House

Micron(20nm) Phison

Kingston(19nm) Phison

Others SMI, Skymedi, Phison, etc…

� Samsung is leading with strong position in eMMC and eMCP, leveraged Samsung smartphone.� SanDisk has most diversified customer portfolios than any other eMMC vendors. � 3rd-party controller houses will find it difficult to compete with in-house solution.

WW eMMC+eMCP Market Share in 2013



1,100mn eMMC units

Vendor Controller House

Samsung(19nm) In-House

SanDisk(1ynm) In-House

SK Hynix(16nm) In-House, SMI

Toshiba(A19nm) In-House

Micron(16nm) In-House

Kingston(A19nm) Phison

Others SMI, Skymedi, Phison, etc…

2014

Samsung

SanDisk

SK Hynix

Toshiba

Micron

Kingston

Others

� eMMC Market share pattern remains stable.� In-House Solutions are dominating. � TWN vendors are narrowing to supplementary role.

WW eMMC+eMCP Market Share in 2014



2010 2011 2012 2013 2014E 2015F

HDD 0.27 0.15 0.09 0.08 0.07 0.06

SSD-OEM 2.39 1.70 0.99 0.71 0.51 0.38

$0

$1

$2

$3

� PC-Client SSD shipment outnumbers but enterprise-SSD consumption is higher.� Total SSD market size increases 87% /36%/37% for 2013/2014/2015

2013 SSD volume 2014 SSD Volume

PC+Retail Enterprise+Industrial

SSD Market: Enterprise is the Bulls Eye

0

30,000

60,000

90,000

120,000

150,000

2011 2012 2013 2014E 2015F Industrial SSD Enterprise SSD PC Retail SSD PC OEM-SSD

Unit: Thousand SSD vs. HDD ($/GB)



� Samsung is prevailing PC-OEM SSD in either MLC or TLC products.� In-House SSD controller is facilitating to performance and time to market.� Marvell flexible business model helps the PC-SSD makers on product differentiation.

2013

Samsung

Intel

Toshiba

SanDisk

Micron

Lite-On

Kingston

Others

2013

LSI-SandForce

Marvell

In-House

Others

WW PC-OEM SSD Market Share and Controller in 2013

~34mn unitsSource: DRAMeXchange,June2014


� 2014 NB market drops 2%YoY with limited growing SSD penetration rate.� Expanded market share for Samsung is credit to higher TLC-SSD in 1st-tier PC makers.

~36mn units

2014

Samsung

Intel

Toshiba

SanDisk

Micron

Lite-On

Kingston

Others

2014

LSI-SandForce

Marvell

In-House

Others

WW PC-OEM SSD Market Share and Controller in 2014



2013

Kingston

Samsung

Crucial

OCZ

Corsair

Adata

Lite-On

Others

2013

LSI-SandForce

Marvell

Samsung

Others

WW Retail SSD Market Share and Controller in 2013


� LSI-SandForce remains No#1 for retail brand for comprehensive firmware support. � Strong Samsung retail SSD sales is attributed by TLC-base SSD.


� LSI-SandForce is still No#1 due to Kingston. � Market share is consolidated to strong brand makers. � 3rd-party SSD controller houses are moving to white-box or module houses.

WW Retail SSD Market Share and Controller in 2014

2014

Kingston

Samsung

Crucial

OCZ

Corsair

Adata

Lite-On

Others

2014

LSI-SandForce

Marvell

Samsung

Others



� 2014 supply bit growth is 38%, bit output is mainly derived from node migrationwhile wafer capacity only increases by 8%.� To cope with middle/low-end mobile devices, TLC-Basis eMMC and SSD are next

battlefield. Most NAND makers will be ready from 2H14. � 1xnm-class eMMC, eMCP and SSD will become mainstream products from 2Q14;

3D-NAND remains future story for 2015.

Key Takeaways

Supply

� 2014 demand bit growth is 39%. Smartphone, tablet and SSD continue to drive the market upward. � Despite of strong end-device shipment pattern, content-per-box growth is limited

due to cost concern and enhanced popularity of middle/low end models. � SSD outperforms other applications in 2014, credit to solid demand from

enterprise-SSD.

Demand


Thanks

[email protected]

2014 NAND Flash Market Update - TrendForce1H14 Weaker OEM and retail market results in over-supply...

Documents

Transcript of 2014 NAND Flash Market Update - TrendForce1H14 Weaker OEM and retail market results in over-supply...