Weekly News

①TrendForce Forecasts DRAM Price Increase in Q3.

②EU May Lower Tariffs on Chinese EVs.

③Charging Infrastructure in China Reaches 9.92 Million Units.

④Micron's Revenue Hits $6.81Billion in March-May, Up 81.6% YoY.

⑤Canalys: US PC Market Expected to Grow.

①TrendForce Forecasts DRAM Price Increase in Q3.

TrendForce has announced that it expects overall DRAM prices to rise by 8-13% in the third quarter. The increase in the traditional non-HBM memory sector is projected to be 5-10%.

The general server demand is anticipated to recover in Q3, with DRAM manufacturers allocating more capacity to HBM. These factors will sustain the DRAM price rise, although the rate of increase will narrow.

Smartphone and cloud server manufacturers still have room to replenish DRAM inventories, and with Q3 being the peak production season, the demand from these sectors will boost DRAM shipments.

Comment: Increased server memory demand will impact general DRAM capacity, which is already affected by HBM production. DRAM prices in the PC market are expected to rise by 3-8%. However, the price increase will moderate due to high inventory levels and weak end-user demand.

②EU May Lower Tariffs on Chinese EVs.

Bloomberg reported on the 26th that the EU has slightly reduced the proposed tariffs on Chinese imported electric vehicles. The EU Commission announced on the 12th that tariffs of 21% would be imposed on companies cooperating with the investigation and 38.1% on those that do not.

After obtaining more information from the affected companies, the EU adjusted the tariffs: BYD's tariff remains at 17.4%, Geely's tariff is reduced from 20% to 19.9%, and SAIC Motor's tariff is lowered from 38.1% to 37.6%.

For other Chinese companies cooperating with the investigation but not sampled, a 20.8% tariff will be imposed, and those not cooperating will face a 37.6% tariff.

Comment: According to Germany's Focus magazine on the 26th, the chairman of the German SME Economic Alliance, Koninemann, criticized the EU for threatening to impose punitive tariffs on Chinese electric vehicles without consulting businesses or seeking the opinions of member states.

③Charging Infrastructure in China Reaches 9.92 Million Units.

As of the end of May this year, the total number of charging facilities in China reached 9.92 million, a year-on-year increase of 56%. Public and private charging facilities reached 3.05 million and 6.87 million units, growing by 46% and 61%, respectively. China now has the world's most extensive, comprehensive, and diverse charging infrastructure system.

As of the end of 2023, the number of new energy vehicles in China exceeded 20 million, with pure electric vehicles accounting for 15.52 million, or over 76%.

Comment: Chinese consumers' demand for new energy vehicles will continue to rise, with electric vehicles, in particular, expected to maintain rapid growth. This has significantly spurred the demand for charging infrastructure construction. According to statistics from the China Association of Automobile Manufacturers, in May 2024, the production and sales of new energy vehicles reached 940,000 and 955,000 units, respectively, with year-on-year increases of 31.9% and 33.3%.

④Micron's Revenue Hits $6.81Billion in March-May, Up 81.6% YoY.

Micron reported better-than-expected results for the fiscal third quarter ending May 30, 2024, with revenues of $6.811 billion, up 17% quarter-on-quarter and 81.5% year-on-year. Non-GAAP operating income was $941 million, with an operating margin increase from 3.5% to 13.8%. Net income was $702 million, up 47% from the previous quarter.

Micron expects prices to continue rising throughout 2024, achieving record revenues in fiscal 2025 and significantly improving profitability by shifting towards higher-margin products.

DRAM revenue was $4.7 billion, accounting for 69% of total Revenue, with a 13% quarter-on-quarter increase. DRAM bit shipments fell by a mid-single-digit percentage, while DRAM ASP rose by about 20%.

NAND revenue was $2.1 billion, accounting for 30% of total Revenue and a 32% quarter-on-quarter increase. NAND bit shipments rose by a high single-digit percentage, while NAND ASP increased by about 20%.

Compute and Networking (CNBU) revenue was $2.573 billion, up 85% year-on-year and 18% quarter-on-quarter; DRAM data center revenue more than doubled year-on-year.

Mobile (MBU) Revenue was $1.588 billion, up 94% year-on-year and down 1% quarter-on-quarter. The 1% decrease from the previous quarter was because the price increase partially offset the planned sales decrease.

Embedded (EBU) revenue was $1.294 billion, up 42% year-on-year and 16% quarter-on-quarter;

Storage (SBU) Revenue was $1.353 billion, up 116% year-on-year and 50% quarter-on-quarter.

Comment: Micron's ending inventory for the third fiscal quarter was $8.5 billion, with inventory turnover days at 155 days, a decrease of 5 days from the previous quarter. Micron stated that DRAM and NAND's supply of advanced products remains very tight.

⑤Canalys: US PC Market Expected to Grow.

According to Canalys, the US PC market shipment volume increased by 5% year-on-year in the first quarter of 2024, reaching 14.8 million units. Canalys expects total US PC shipments to reach 69 million units by the end of 2024 and grow by another 8% to 75 million units in 2025.

The impending end of support for Windows 10 is a major driver of this growth, prompting consumers and businesses to consider new PC purchases. Canalys analyst Greg Davis noted that many users still rely on Windows 10, and the PC upgrade trend will accelerate over the next four months.

Comment: The report also mentioned that new AI features in upcoming PC products within the Apple and Windows ecosystems might further stimulate market shipments, meeting analysts' expectations.