Micron, current king of DRAM and NAND, sees big auto chip demand


Micron could easily call itself the memory company because the Boise, Idaho, company keeps topping its prior innovations and financial performance.

Recently Micron announced volume shipment of 1-alpha node DRAM products using what it called the world’s most advanced DRAM process technology for 40% better bit density, low-power and high performance.  The 1a node will be used across Micron’s DRAM product portfolio.

That announcement follows an earlier claim of offering the world’s fastest graphics memory and the first shipping 176-layer NAND.

Micron also claims the 1a will have a 15% improvement in power savings, allowing 5G smartphone users to save battery life.  It is designed for 8 GB to 16 GB densities to help Micron’s customers that make servers, clients, and devices for networking and embedded designs. Total cost of ownership is improved.

The company said its Taiwan fabs have begun the 1a node DRAM production in volume beginning with a DDR4 memory for compute customers and Crucial PC DRAM products. Samples of LPDDR4 have been provided to mobile customers and more products are coming through 2021.

Memory and storage will be the fastest growing segments in semiconductors in coming years, according to analysts, and Micron is a clear industry leader in both DRAM and NAND.  In 2019, Micron was ranked the fourth biggest semiconductor producer overall with about $20 billion in revenues with Intel in the top position and Samsung Electronics and SK Hynix in the second and third spots.

Some semi companies have not yet announced 2020 total revenues, although Micron in early January announced its first fiscal 2021 quarter results for results through Dec. 3,2020.  In all, the company said it had $5.8 billion in revenue for that period, up from $5.14 year-over-year.

 When that fiscal quarter result was announced, CEO Sanjay Mehrotra said Micron was the market leader in both DRAM and NAND technologies. “We are in an excellent position to benefit from accelerating digital transformation of the global economy fueled by AI, 5G, cloud and intelligent edge,” he said in a statement.

In a conference call with analysts on Jan. 7 , however, he noted that Taiwan manufacturing operations were hit by a power outage on Dec. 3 and an earthquake on Dec. 10.  “These disruptions have reduced our available fiscal second quarter DRAM supply and negatively influenced our costs in the short term” with that impact factored into the company’s outlook, Mehrotra said, according to a Seeking Alpha transcript.   The company nonetheless pegged its revenue outlook for its second fiscal quarter at a healthy $5.8 billion.

Like several other semi companies, including Texas Instruments and On Semiconductor, the end of 2020 was good for Micron in sales of auto chips.  In fact, its fiscal first quarter brought record  auto revenues due to resumption of auto manufacturing and the growth in the use of memory and storage content in each vehicle produced. Electric vehicles also have higher semiconductor content and autonomous vehicles will add more chips as the technology advances, Mehrotra noted. Auto chip revenues are part of Micron’s Embedded Business Unit and not broken out, but the entire EBU had revenues of $809 million in the first fiscal quarter, up 10% year-to-year.

Overall, he said that DRAM and NAND have grown faster than the broader semiconductor industry, moving from 10% of the broad industry revenues in the early 2000s to now approaching 30%.

While noting some demand problems related to the pandemic for both NAND and DRAM in 2021, he said the long-term demand outlook is an annual growth rate of mid to high teens for DRAM and 30% for NAND.

Micron shares opened on Tuesday at 80.61, below a six-month high of 85.50 on Jan. 19.

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