DRAMeXchange, the research arm of TrendForce, recently reported the global NAND market grew by 8.3 percent sequentially in the first quarter. The organization noted increased demand from cloud service providers drove the uptick in flash memory revenue.
The firm also predicts the sector will continue to expand in the second quarter due to COVID-19 related remote work and education transitions.
NAND Q1 Sales Spike Explained
According to DRAMeXchange, the world’s branded NAND retailers sold $13.58 billion worth of products in the first quarter, up from $12.45 billion in Q4 2019. The analytics group noted web service providers ramped up their flash memory purchases to increase the capacity of their data centers. The firm explained the upward trend began late in Q4 2019 but ramped up significantly last period.
Cloud service provided stocked up on enterprise SSD modules in the March quarter due to massive spikes in user activity.
Netflix, Disney Plus, and HBO Now experienced significant rises in content consumption as the coronavirus pandemic prompted widespread government shelter-in-place decrees. Similarly, remote work application companies like Zoom saw explosive subscriber growth via newly homebound workers and students. Microsoft, Sony, and Valve also reported record usage of their online video game platforms following the COVID-19 outbreak.
DRAMeXchange also found NAND revenue increased in Q1 because server chipmaker supply chains recovered faster than those maintained by consumer electronics manufacturers. However, that segment of the industry is predicted to make a big resurgence in the second quarter.
Continued NAND Revenue Growth in Q2
The firm’s research indicates the NAND market will continue to grow in Q2 because notebook, tablet, and smartphone manufacturers have experienced surges in demand for work-from-home staffers and remote learners.
The group’s findings correspond with a recent Digitimes Research report that laptop and slate computer shipments have risen by 40 and 45 percent, respectively, in the current quarter. Besides, AMD, Intel, and Nvidia recorded spikes in demand for portable electronics processors because of COVID-19.
In addition, Big Tech giants like Facebook, Google, and Twitter have transitioned thousands of their employees to remote operation. As such, staffers from these and other corporations joining the work-from-home trend will keep equipment purchases high in the June period.
DRAMeXchange also forecasts continued enterprise SSD sales growth as cloud service providers continue adjusting to the new normal. Although the coronavirus pandemic significantly disrupted the flash NAND market at the start of the year, it has unexpectedly turned into a major growth driver.