Opinions from people in the semiconductor industry
### Memory industry revenue is expected to reach record highs in 2025 due to rising average prices and the rise of HBM and QLC
According to TrendForce's latest report, DRAM and NAND flash earnings are expected to increase drastically by 75% and 77% in 2024, respectively, due to increased bit demand, improvements in supply and demand structures, and the rise of HBM, which is a high-value product.
Furthermore, revenue growth will continue in 2025, and DRAM is expected to increase by 51% and NAND flash by 29%, reaching record highs. This growth is expected to trigger a revival of capital expenditure and an increase in demand for upstream raw materials, but it will also increase cost pressure on memory buyers.
### The rise of HBM boosts DRAM revenue
According to TrendForce estimates, since the average price of DRAM will increase by 53% in 2024 and 35% in 2025, it is predicted that DRAM revenue will reach 90.7 billion dollars in 2024 and 136.5 billion dollars in 2025.
The rise of HBM, generational changes in general DRAM products, capital expenditure suppression by manufacturers that limit supply, and a recovery in server demand are cited as the four main factors driving growth in DRAM earnings. Compared to general DRAM, HBM not only boosts bit demand, but also raises average prices in the industry. HBM is expected to account for 5% of DRAM bit shipments and 20% of revenue in 2024.
Furthermore, the penetration of high-value products such as DDR5 and LPDDR5/5X will also raise average prices in the industry. According to TrendForce estimates, DDR5 will account for 40% of server DRAM bit shipments in 2024, and is expected to increase to 60-65% in 2025. LPDDR5/5X is expected to account for 50% and 60% of mobile DRAM bit shipments in 2024 and 2025, respectively.
### High Capacity QLC Enterprise SSDs and UFS Will Boost 2025 NAND Flash Revenue
According to TrendForce's forecast, NAND flash revenue will reach 67.4 billion dollars in 2024 and 87 billion dollars in 2025, and is expected to increase 77% and 29% per year. The rise of high-capacity QLC enterprise SSDs, adoption of QLC UFS in smartphones, capital expenditure suppression by manufacturers that limit supply, and recovery in server demand have contributed to this. North American CSPs (cloud service providers) have already begun to widely adopt QLC enterprise SSDs, especially for inference AI servers with high capacity specifications.
According to TrendForce estimates, QLC will account for 20% of NAND flash bit shipments in 2024, and is expected to increase further in 2025. In smartphone applications, QLC has gradually penetrated the UFS market, and some Chinese smartphone manufacturers plan to begin adopting QLC UFS solutions in the fourth quarter of 2024. Apple also plans to introduce QLC to iPhones by 2026.
### The impact of growing DRAM and NAND flash revenue on the industry ecosystem
TrendForce reports that as earnings in the memory industry reach record levels, manufacturers have sufficient cash flow and can accelerate investment. Capital expenditure in the DRAM and NAND flash industries is expected to increase by 25% and 10%, respectively, in 2025, and there is a possibility of further upward revisions.
Demand for upstream raw materials such as silicon wafers and chemical products will increase due to the expansion of memory production. Meanwhile, due to rising memory prices, the cost of electronic products will also increase. ODM/OEM companies will find it difficult to fully transfer these costs to retail prices, and profit margins will be compressed. This cost increase will slow end user sales and may also cause a decrease in demand.
According to TrendForce's latest report, DRAM and NAND flash earnings are expected to increase drastically by 75% and 77% in 2024, respectively, due to increased bit demand, improvements in supply and demand structures, and the rise of HBM, which is a high-value product.
Furthermore, revenue growth will continue in 2025, and DRAM is expected to increase by 51% and NAND flash by 29%, reaching record highs. This growth is expected to trigger a revival of capital expenditure and an increase in demand for upstream raw materials, but it will also increase cost pressure on memory buyers.
### The rise of HBM boosts DRAM revenue
According to TrendForce estimates, since the average price of DRAM will increase by 53% in 2024 and 35% in 2025, it is predicted that DRAM revenue will reach 90.7 billion dollars in 2024 and 136.5 billion dollars in 2025.
The rise of HBM, generational changes in general DRAM products, capital expenditure suppression by manufacturers that limit supply, and a recovery in server demand are cited as the four main factors driving growth in DRAM earnings. Compared to general DRAM, HBM not only boosts bit demand, but also raises average prices in the industry. HBM is expected to account for 5% of DRAM bit shipments and 20% of revenue in 2024.
Furthermore, the penetration of high-value products such as DDR5 and LPDDR5/5X will also raise average prices in the industry. According to TrendForce estimates, DDR5 will account for 40% of server DRAM bit shipments in 2024, and is expected to increase to 60-65% in 2025. LPDDR5/5X is expected to account for 50% and 60% of mobile DRAM bit shipments in 2024 and 2025, respectively.
### High Capacity QLC Enterprise SSDs and UFS Will Boost 2025 NAND Flash Revenue
According to TrendForce's forecast, NAND flash revenue will reach 67.4 billion dollars in 2024 and 87 billion dollars in 2025, and is expected to increase 77% and 29% per year. The rise of high-capacity QLC enterprise SSDs, adoption of QLC UFS in smartphones, capital expenditure suppression by manufacturers that limit supply, and recovery in server demand have contributed to this. North American CSPs (cloud service providers) have already begun to widely adopt QLC enterprise SSDs, especially for inference AI servers with high capacity specifications.
According to TrendForce estimates, QLC will account for 20% of NAND flash bit shipments in 2024, and is expected to increase further in 2025. In smartphone applications, QLC has gradually penetrated the UFS market, and some Chinese smartphone manufacturers plan to begin adopting QLC UFS solutions in the fourth quarter of 2024. Apple also plans to introduce QLC to iPhones by 2026.
### The impact of growing DRAM and NAND flash revenue on the industry ecosystem
TrendForce reports that as earnings in the memory industry reach record levels, manufacturers have sufficient cash flow and can accelerate investment. Capital expenditure in the DRAM and NAND flash industries is expected to increase by 25% and 10%, respectively, in 2025, and there is a possibility of further upward revisions.
Demand for upstream raw materials such as silicon wafers and chemical products will increase due to the expansion of memory production. Meanwhile, due to rising memory prices, the cost of electronic products will also increase. ODM/OEM companies will find it difficult to fully transfer these costs to retail prices, and profit margins will be compressed. This cost increase will slow end user sales and may also cause a decrease in demand.
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