Memory supply to remain tight in 3Q17, says Transcend

Supply of DRAM and NAND flash memory chips is expected to remain tight through the third quarter of 2017, according to memory module firm Transcend Information.

Due to the ongoing tight supply, memory contract prices will continue their growth in the short term, Transcend indicated.

Tight supply of NAND flash chips, particularly triple-level cell (TLC) ones for use mainly in consumer flash devices, negatively affected Transcend's sales performance in the second quarter. The company posted revenues of NT$5 billion (US$165.5 million) in the second quarter of 2017, down 6.3% on year.

However, with Transcend putting increased focus on niche-market products, the company saw its gross margin increase to 26.2% in the second quarter of 2017 from 21.1% a year earlier. Operating profits for the quarter came to NT$930 million, rising 33.8% compared to the same period in 2016.

Of Transcend's second-quarter revenues, industrial control products accounted for 43.6%, followed by standard DRAM products with 19%, consumer flash devices 18.9% and strategic products 18.5%.

Transcend reported net profits of NT$776 million for the second quarter of 2017, with EPS reaching NT$1.80.

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