Samsung sees 'very strong' DRAM demand

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(Free-Press-Release.com) November 13, 2006 -- Chu Woo-Sik, senior vice president of investor relations, also said that Samsung will sell more mobile phones in January-March quarter than in the current one and that its LCD business is performing better than expected in the current quarter.

The world's top memory chipmaker and biggest maker of large LCDs (liquid crystal displays) also said it is considering an additional eighth-generation LCD line.

"Our DRAM (dynamic random access memory) orders for Q1 are very strong, considering the seasonality aspect. We have most of the orders for Q1 as PC (original equipment makers) are ordering to be Vista-ready," Chu said Monday at the Samsung Tech Forum 2006 in Singapore.

Samsung, the world's third-largest handset maker after Nokia and Motorola, sold a record 30.7 million phones in the July-September quarter and has said it expects to beat that in the fourth quarter.

Samsung's mobile business is recovering from a difficult first half--during which it was hurt by the runaway success of Motorola's Razr phone--with the success of a new series of ultra-sleek phones launched over the summer.

Song Myung-sup, analyst at CJ Investment & Securities, said he expects Samsung to sell just over 31 million phones in the fourth quarter and 33 million in the first quarter of 2007.

Chu said half the demand for Samsung's handsets will come from emerging markets next year. "We see a big surge from Eastern Europe and India," he added.

He said that demand and prices for DRAM chips, used mostly in personal computers, were strong in the fourth quarter and that the market for NAND flash-memory chips, popular in digital cameras, is stabilizing as well.

"Overall demand is expected to be pretty strong for NAND flash next year," Chu said, adding that demand will be supported by new applications such as music cell phones, car navigation systems and portable media players.

Chip and PC makers have been eagerly awaiting the release of the Vista operating system as consumers have been delaying the purchase of new PCs for the same reason.

"For a while, there were oversupply fears about DRAM for the first half of 2007, but it seems manufacturers are fairly confident demand will remain sufficient," said CJ's Song.

On LCDs, Chu said the fourth quarter was shaping up to be better than anticipated, thanks to cost cuts and a recovery on the monitor display side.

"In the second half of 2007, there could be a shortage of LCD panels on the TV side," as the LCD industry delays fresh investment in the wake of price falls, Chu said.

Jun H. Souk, executive vice president of LCD Research and Development Center, told reporters that Samsung is mulling an additional eighth-generation LCD line but had not decided whether it would be built with Japan's Sony. A Sony representative declined comment on the matter.

The 8G line will use bigger glass panels, enabling makers to produce more LCD panels and boost efficiency. Eighth-generation mother-glass substrates yield eight 46-inch TV panels or six 52-inch panels, versus six 46-inch panels from 7th-generation glass.

David Steel, vice president of marketing at Samsung's digital media division, told reporters he expected global sales for LCD TVs to rise to 66 million units in 2007 from an estimated 42 million this year, while plasma display TVs would increase to 13 million from 10 million.

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