Gartner Dataquest Says Worldwide DRAM Industry Grows 37 Percent in 2002, According to Preliminary Results.

EGHAM, England--(BUSINESS WIRE)--Dec. 17, 2002

Gartner Dataquest (NYSE: IT and ITB)

Samsung Retains Leadership in DRAM Market, as Micron and Hynix

Lose Share

Worldwide dynamic random access memory (DRAM) revenue reached $16.2 billion in 2002, a 36.7 percent increase from 2001, according to preliminary statistic released by Dataquest Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).

Samsung Electronics strengthened its position as the No. 1 DRAM supplier, increasing its revenue market share to 31 percent, more than 13 percent ahead of its nearest rival (see Table 1). Micron Technology and Hynix Semiconductor saw their market shares drop in 2002, but held onto their rankings as the No. 2 and No. 3 vendors, respectively.

"Samsung had an exceptional year, and contrary to its rivals, it managed to make a profit throughout the year," said Andrew Norwood, senior analyst with Gartner Dataquest. "Samsung's revenue was strengthened by its high exposure to premium price products, such as Rambus DRAM (RDRAM) and Double Data Rate static RAM (DDR SRAM)."

Table 1
Preliminary Top 10 Worldwide DRAM Vendors by Revenue Estimates
(Millions of U.S. Dollars)
----------------------------------------------------------------------
                               2002                2001      2002-2001
                       2002    Market     2001     Market     Growth
Company               Revenue  Share (%) Revenue   Share (%)    (%)
----------------------------------------------------------------------
Samsung Electronics     4,992    30.8     3,200     27.0       56.0
Micron Technology       2,791    17.2     2,260     19.1       23.5
Hynix Semiconductor     2,104    13.0     1,716     14.5       22.6
Infineon Technologies   1,981    12.2     1,154      9.7       71.7
Elpida Memory           1,032     6.4     1,011      8.5        2.1
Nanya Technology          785     4.8       273      2.3      187.7
Others                  2,526    15.6     2,242     18.9       12.7
Total Market           16,212   100.0    11,856    100.0       36.7
----------------------------------------------------------------------
Notes: Micron Technology's revenue includes Toshiba's commodity DRAM
revenues for the first quarter of 2002. Source: Gartner Dataquest
(December 2002)

Hynix Semiconductor's revenue increased 23 percent in 2002, but its market share declined from 2001 results. "Hynix has been losing share in some of the big accounts, and its low percentage of premium products has kept revenue growth below the overall industry average," Norwood said.

Infineon Technologies saw strong revenue growth in 2002, and increased its market share to 12 percent, but failed to catch Hynix. "This is the first time Infineon Technologies has broken the 10-percent barrier," said Norwood. "This is also the eleventh consecutive year the company has managed to increase its market share."

Overall, Japanese DRAM vendors had a tough year. "Japan, once the DRAM powerhouse country, has been pushed into last place. Japanese vendors now only control 12 percent of the market, compared with 21 percent in 2001," said Norwood. This is a marked change from 1986 when Japanese vendors controlled 78 percent of the market.

Gartner Dataquest analysts said Taiwanese vendors had an exceptional year, as they secured 14 percent of the market in 2002, compared with 8.4 percent in 2001. Among the Taiwanese vendors, Nanya Technology was the big winner, moving up from eighth position in 2001 to sixth in 2002.

Despite the healthy revenue growth in 2002, Gartner Dataquest analysts said most DRAM vendors are still experiencing revenue losses. This is leading to increasing trade friction among the major producing regions. Recently, the U.S. International Trade Commission announced that it was going to continue its investigation into whether allegedly subsidized imports of DRAM from South Korea have injured the domestic U.S. producers in 2002. Micron has been calling for a full investigation for some time, but Norwood does not believe these alleged subsidies are the main cause of Micron's market share decline.

DRAM remains the most volatile sector of the worldwide semiconductor market. Worldwide semiconductor revenue grew 1.4 percent in 2002. If DRAM revenue were excluded from the total semiconductor market, worldwide semiconductor sales revenue would have decline by 2 percent.

Additional information on this market is available in the Gartner Dataquest Perspective "2002 Preliminary DRAM Market Share" This market analysis examines the performance of the top 10 DRAM manufactures worldwide.

This research is produced by Gartner Dataquest's Semiconductors Worldwide group. This research group combines memory, microcomponents, logic, ASIC, analog, discrete device, RF and optical segments into a complete industry picture. Products, suppliers, startups, technologies, regional consumption, applications and emerging technologies are all covered in this broad program. More information about Gartner Dataquest semiconductor programs and reports can be found in the Gartner Semiconductor Focus Area at http://www.gartner.com/semiconductor-mkt. To subscribe to this service, please call 408-468-8000. Reports can be purchased on the Internet at www.gartner.com.

Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry.

Gartner, Inc. is a research and advisory firm that helps more than 10,500 clients leverage technology to achieve business success. Gartner's businesses consist of Research, Consulting, Measurement, Events and Executive Programs. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, and has 4,000 associates, including more than 1,000 research analysts and consultants, in more than 75 locations worldwide. Fiscal 2002 revenue totaled $907 million. For more information, visit www.gartner.com.