SAMSUNG ELECT LTD(F) (SSNLF), TOSHIBA CORP (TOSBF), Micron Technology, Inc. (MU): Industry Consolidation Calls for DRAM Price Appreciation

Three key players (Samsung, Toshiba and Micron) cover 80% of the total DRAM market. SAMSUNG ELECT LTD(F) (NASDAQOTH:SSNLF) is the leader with a 39% market share, while Toshiba and Micron enjoy 27% and 14% share, respectively. One of Samsung’s manufacturing plants is located 30km away from the Korean border, from which it manufactures most of its NAND flash memory. Due to tension between North Korea and South Korea, if Samsung needs to shut down its manufacturing facilities ot will significantly impact the company’s quarterly earnings.

TOSHIBA CORP  (NASDAQOTH:TOSBF) is plagued by the unreliable yen, which has severely impacted the top line. The recent depreciation in the yen can have a 7.8% impact on the company’s revenue. TOSHIBA CORP  (NASDAQOTH:TOSBF) is the largest player in the HDD market, with an 11% market share. It manufactures a wide range of products from drives and laptop to radar systems. Due to high manufacturing costs, Toshiba cut down its SSD production.

The decline in the PC market and rapid increase of smartphones and tablets will provide a strong platform for the semiconductor industry to grow. Micron Technology, Inc. (NASDAQ:MU) is also investing in its manufacturing process to clamp down its operating expenses, which in turn will improve its bottom line.