Flash Memory Forecast Whacked On Soft Economy, Apple Spending
The firm slashed its NAND memory growth projection by two thirds this morning: iSuppli expects global NAND flash memory revenue to reach $15.2 billion this year, representing 9% growth from last year, when it reached $13.9 billion. Previously, iSuppli had estimated the market would grow 27% this year to hit $17.9 billion.
Why the drop? One big reason: Lower spending growth from big memory buyers like Apple. iSuppli projects Apple's NAND flash spending will increase 12% this year to $1.4 billion, up from $1.2 billion last year. Previously, the firm had expected Apple's spending to jump 32% this year to $1.6 billion. Similarly, the firm predicts lower-than-expected spending growth from SanDisk (SNDK) and Sony (SNE).
Who gets burned here? Lower NAND flash spending is bad news for all of the big players, including Samsung, Toshiba, Hynix, and Intel (INTC), which has already warned about weakening memory prices, iSuppli says.
Why is apple seen as such a huge player. They only have 1/15th of the market. That is pretty low."
Rick, Apple's iPod has between 70%-80% of the media player market (which is the main use of NAND). In addition to that Apple has 21% of the consumer PC market in the US (Google it), and PCs also use NAND. So Apple is a major player in the use of NAND, and their orders affect the market.
Also, Apple is buying the largest and most lucrative sizes for the OEMs. Not the smallest and cheapest sizes.