NAND Flash Market Trend and Beyond-

Transcription

1 NAND Flash Market Trend and Beyond- Sean Yang NAND Flash Team Memory & Storage Division, TrendForce May, 2016 Page 1

2 NAND Flash Market: 2016 is a Challenging Year 2016 NAND market momentum is softened amid the macro economy noise and steeper ASP erosion from over-supply dynamics. USD$bn $30-0.2% 1.3% 5.8% 6.0% 2.6% 1.9% 1.8% 5.1% $25 -Market Sufficiency- $20 $15 $ CAGR: 11% $5 $0 ASP($/GB ) E $2.12 $1.80 $1.25 $0.74 $0.60 $0.44 $0.32 $0.22 YoY -32% -15% -31% -41% -18% -27% -27.3% -31.3% May, 2016 Page 2

3 Macro Supply&Demand: Still Over-Supply With accelerated 15nm/3D-NAND migration and weak demand, supply bit growth exceeds demand bit growth (46% vs. 42%) NAND market is doomed to be oversupply. Unit: 2GB M equiv. 70,000 60,000 74% 54% 80% 77% -Supply Bit Growth- -Demand Bit Growth- 75% 68% 58% 59% 41% 45% 40% 39% 47% 47% 46% 42% 50,000 40,000 30,000 20,000 10, E Bit Supply Shipment Bit Demand Shipment May, 2016 Page 3

4 Quarterly Supply&Demand: Imbalance Eased in 2H16 2H16 market imbalance will be eased. NAND capacity upgrade is likely doubled in iphone7 (32GB/128GB/256GB). emmc/emcp: Content growth is significantly increased in smartphones. Client-SSD: NB attached rate and capacity continue to hike. Enterprise-SSD: Strongly grow with server/data center demands. Unit: 2GB M Equiv. 20,000 20% 16% 15,000 12% 10,000 5,000 8% 4% 0% -4% 0 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E3Q16E4Q16F -8% Supply Vol. Demand Vol. Sufficiency May, 2016 Page 4

5 Channel TLC-Wafer Contract Price Trend $3.2 $2.8 $2.4 $2.0 $1.6 $1.2 $0.8 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 32Gb TLC-Wafer 64Gb TLC-Wafer 128GB TLC-Wafer TLC-Wafer is the indicator about channel market. NAND makers start to re-allocate the NAND capacity to OEM product, resulted in stable TLC wafer pricing from late Q1. Upward pricing trend likely continue in Q316 corresponding with balanced market dynamics. May, 2016 Page 5

6 emmc Pricing Forecast emmc ASP down 14-16%/7-8% in Q1/Q2 respectively, 2H16 pricing will be stabilized. 16GB-128GB emmc pricing is expected to down 36-40%yoy, reflecting of the oversupply conditions and increasing TLC-eMMC portion. Steeper ASP erosion in high density helped to drive the content per box growth. $70 $60 $50 $40 $30 $20 $10 $- 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16E 4Q16F 8GB emmc 16GB emmc 32GB emmc 64GB emmc 128GB emmc May, 2016 Page 6

7 Client-OEM SSD Pricing: Sweet Point is Coming Accelerated client-oem SSD price erosion is from 3D-NAND and 15/16nm TLC-SSD. 128GB SSD price will crossover 500GB HDD after 3Q16, while price gap between 256GB SSD and 1TB HDD is less than $5 in 4Q notebook SSD attach rate is 33%, mostly contributed from commercial models. More than 50% of notebook storage will be in SSD from $ (Unit: Million) 100% $ % $ % $ % $ % $20 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16E 4Q16F 128GB SSD 256GB SSD 500GB HDD 1000GB HDD E 2017F 2018F Notebook Vol. SSD(%) 0% May, 2016 Page 7

8 NAND CAPEX: All In for 3D-NAND 2016 CAPEX is majorly for 3D-NAND migration and new fab construction. Except for Samsung, other NAND makers have booked 30-40k/m 3D-NAND capacity facility from equipment suppliers. Limited investment from 4Q15, Planar NAND will be tight supply. Unit: US$M +20% Capacity (10K WSPM) New 3D-NAND New Planar NAND 3D-NAND Conversion from Planar Planar NAND migration Cost $ M $ M $ M $ M 3D vs. Planar Measurement Wafer Processing Time 3-4 Times Space for tooling 3-5 Times Wafer Cost >80% May, 2016 Page 8

9 NAND Flash Capacity Forecast: 3D Era is Coming Unit: KPCs,12 equiv. Fab 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E 3Q16F 4Q16F Fab Fab Xian Samsung Fab2(New) Fab Fab Fab TSB/SNDK M M M14 0 Hynix Manassas Lehi Fab Fab Dalian 25 MU/INTL total capacity is up ~10%YoY. Samsung: XiAn fab is fully loaded after 2Q16 at 100k/m. TSB/SNDK: New Fab 2, dedicated at 3D-NAND, production kicked off from 1Q16. Hynix: 3D-NAND conversion takes place in M12. 3D-NAND in M14 is pushed out to MU/INTL: New added 3D-NAND capacity in Fab10X from 3Q16 while conversion in Fab 10 is ongoing; Dalian fab MP schedule for 3D-NAND is from 4Q16. May, 2016 Page 9

10 NAND Architecture: TLC is Over 50% from 2Q16 iphone6s/plus: 128GB is all in TLC, 80% for 64GB. Higher TLC usage in iphone7 is up to 256GB. emmc is 48% in TLC while Client-SSD is also 56% in TLC. 3D-NAND for client SSD and emmc/emcp will be mostly in TLC basis, TLC portion reaches ~60% existing iphone 6S/Plus iphone 7/Plus, 3D-NAND SSDs 100% 80% 60% 40% 20% 0% 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E 3Q16F 4Q16F SLC MLC TLC May, 2016 Page 10

11 NAND Technology Trend 2D-NAND: 14/15nm tech node is the last generation. 3D-NAND: Samsung is still leading. other competitors find it difficult to compete in terms of commercialization in emmc/emcp and SSDs. Despite of introduction in early 1H16, 3D X point sample schedule will delay to 1Q17. Source: Company data, complied by DRAMeXchange, May, Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 16nm 14nm 32 Layers(MLC/TLC) 48Layers(MLC/TLC) 64 Layers(MLC/TLC) A19nm 15nm 48 Layers(TLC) 64 Layers(TLC) 16nm 14nm 2D-NAND 3D-NAND 36 Layer(MLC)/48 Layer(TLC) 16nm 32 Layer(MLC/TLC) 72 Layer(MLC/TLC) 64 Layer(MLC/TLC) 3D X Point May, 2016 Page 11

12 Node Migration: 3D-NAND Hikes from 2H16 100% 80% 60% 40% 20% 0% 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E 3Q16F 4Q16F 90nm 6X & 7X nm 5Xnm 4Xnm 3Xnm 2xnm 20nm-Class 1xnm-Class 3D-NAND Mainstream node for emmc/emcp and client SSD in 2016 is 15/16nm D-NAND competition will still be dominated by Samsung. 3D-NAND portion will reach 30% existing May, 2016 Page 12

13 Density Migration: Larger is Better 15nm/16nm planar NAND main device is 128Gb, minimum is 64Gb. All 48 layer 3D-NAND chips starts from 256Gb. 128Gb is already >70% from 1Q Gb will reach almost 20% of total output in 4Q % 80% 60% 40% 20% 0% 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E 3Q16F 4Q16F <8Gb 8Gb 16Gb 32Gb 64Gb 128Gb 256Gb 384Gb May, 2016 Page 13

14 NAND Flash Financials: Steady Margins 2016 NAND OPM is likely squeezed due to sharper ASP erosion and limited cost reduction from migration. OPM difference among NAND makers varies from product matrix, customer portfolio, and pricing strategy. 40% 30% NAND Flash Operating Margin 20% 10% 0% -10% 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16-20% Samsung SK Hynix Micron Toshiba May, 2016 Page 14

15 NAND Flash Demand Outlook Unit: 2GB M equiv. 60,000 50,000 40,000 30,000 20, demand bit growth is 42%. smartphone, tablet and SSD accounts more than 90% of total demand. SSD segment, represented 34% of total demand, is the strongest enddemand application in NAND applications show long-term committed growth through years. 10, E Handset SSD Tablet PMP USB Drive DSC Others May, 2016 Page 15

16 emmc Market Overview emmc market is slowing down with matured smartphone growth and declining tablet. Content growth is the key to drive the market. With >70% in 64GB/128GB for iphone6s/plus, other smartphone brands are forced to raise content to compete. Unit: 2GB M equiv. 60, % 50,000 80% 40,000 60% 30,000 20,000 -Other Demand- -emmc Demand- 33% 40% 32% 10, % 3% 15% 24% E 20% 0% 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E 3Q16F 4Q16F 2GB 4GB 8GB 16GB 32GB 64GB 128GB May, 2016 Page 16

17 emmc/emcp in Smartphone 2016 smartphone market growth is a history-low 2.3%YoY but content growth is stronger from market competition and hardware spec requirement. (i.e. camera, O.S., panel) Higher 64GB/128GB exposure in high-end smartphone while 16GB is the minimum. emmc % in Smartphone Smartphone and emmc content Unit: Million % 81% 78% 83% 86% 82% 79%84% 82% 78% 84% 72% Unit: Million 1,500 1, Q14 3Q14 1Q15 3Q15 1Q16 3Q16F E 2016F Smartphone emmc Content (GB) 0 May, 2016 Page 17

18 emmc in Branded Tablet Except for proprietary NAND for ipad, emmc is the standard storage design for tablets. Tablet shipment declines, content growth is also slower than smartphone. emmc % in Branded Tablet Tablet and emmc content Unit: Million 50 56% 62% 54% 56% 62% 60% 63% 55% 65% 65% Unit: Million % 58% Q14 3Q14 1Q15 3Q15 1Q16 3Q16F E 2016F Branded Tablet emmc Content (GB) 0 May, 2016 Page 18

19 emmc Technology Trend: Faster and Cheaper Smartphone OEMs continue to squeeze BOM cost from storage and memory amid the performance and price. TLC-eMMC and emmc5.1 is the trend for middle to low end segments. With >10% price premium of emmc, UFS still remains in high-end smartphones. More AP platforms will start to support UFS from % 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% E 2017F 2018F 2D NAND-MLC 2D NAND-TLC 3D NAND-MLC 3D NAND-TLC 0% E 2017F 2018F emmc 4.5 emmc 5.0 emmc 5.1 emmc 5.X UFS May, 2016 Page 19

20 emmc for More Applications emmc is expanding the frontier to consumer electronics and emerging devices. Unit: 1GB M equiv. 12,000 9,000 $0.53 $0.51 $0.48 $0.45 $0.42 $0.39 $0.36 $0.32 $0.27 $0.25 $0.23 $0.21 Chromebook and 2-in-1 notebook 1. Chromebook is changing storage media to emmc Chromebook is 7.5mn units, 2016 is estimated at 8-9mn units. 2. emmc-based notebook popularity increases, market share is 15% in Smart TV &STB 6,000 emmc Price per GB 1. Smart TV emmc density is moving to above 4GB. 8-16GB is for high-end models. 2. High-end STB is moving to emmc from SLC for more content loaded. (Apple TV and MI box are good examples.) 3, Q14 3Q14 1Q15 3Q15 1Q16 3Q16F Wearable Device 1. New Apple Watch NAND density is moving up to 16GB/32GB/64GB from 4GB/8GB in previous model. 2. Premium wearable devices are catching up for emmc usage. May, 2016 Page 20

21 2016 Preliminary Consumer emmc/emcp Market Share 2016 emmc market share remains similar to 2015 level given the stable smartphone and tablet OEMs shares. Samsung is outperforming, benefited from robust in-house smartphone demand and over 50% emcp market share in China E Samsung Toshiba SK Hynix SanDisk Kingston Micron Others Samsung Toshiba SK Hynix SanDisk Kingston Micron Others ~1,300 million units ~1,390 million units Notes: Industrial, automotive, etc is not included in this table. May, 2016 Page 21

22 SSD Market Over View Unit: Million Client-OEM and Client-Retail remain biggest shipment portions but enterprise SSD growth outperforms the industry. Client SSDs: 15/16nm TLC-SSD and 3D- NAND will accelerate the price erosion in SSD NB adoption rate hikes. Enterprise SSDs: High growth/margin and stable pricing trend, benefited from surging cloud computing demand as well as booming datacenter infrastructure E Industrial Enterprise Client-Retail Client-OEM May, 2016 Page 22

23 Client SSD Market: Price Parity is Even Closer The price gap between HDD and SSD is narrowing to x4 times in D-NAND SSD will drive the SSD price down even further in next years. Most PC-OEMs are moving to 256GB spec, average SSD content is 246GB this year and more than 300GB in $1.0 Client-OEM SSD vs. HDD ($/GB) 100% $0.8 80% $0.6 $0.4 $0.2 $ E 2017F 2018F HDD $0.08 $0.07 $0.06 $0.06 $0.05 $0.05 SSD $0.68 $0.55 $0.39 $0.26 $0.17 $ % 40% 20% 0% E 2017F 2018F 1TB 512GB 256GB 128GB 64GB 32GB 16GB May, 2016 Page 23

24 Client SSD Technology Trend: 3D NAND with PCIe 15/16nm TLC and 3D-NAND SSDs provide strong pricing incentive for PC-OEMs together is 56% shares. 3D-NAND TLC is a perfect fit for client SSDs. Despite of lack support and few options in 2015 and 2016, PCIe portion eyes at 30% in 2017 with Intel new Kaby-Lake platform in 2H16 and more PCIe SSDs introductions. 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% E 2017F 2018F 0% E 2017F 2018F 2D NAND-MLC 2D NAND-TLC 3D NAND-TLC 3D NAND-MLC SATA III PCIe Gen2 PCIe Gen3 Others May, 2016 Page 24

25 2016 Preliminary Client-OEM SSD Market Share Samsung is outstanding from aggressive pricing, diversified product portfolio as well as product quality. In 2016, Samsung shares remains since most PC-OEMs intend to raise shares from other suppliers. Other SSD vendors are accelerating Planar TLC-SSDs and 3D-NAND SSD to shorten the gap with Samsung Samsung 2016E Samsung Hynix Intel Toshiba SanDisk Micron Lite-On Kingston Others Hynix Intel Toshiba SanDisk Micron Lite-On Kingston Others ~42 million units ~53 million units May, 2016 Page 25

26 Enterprise-SSD market: Strong Catalyst Strong Enterprise-SSD catalyst is benefited from surging cloud services and e- commerce demand. Booming hyper-scale and data center infrastructure will help enterprise-ssd segment outperforming other NAND applications in next years. Content growth is also strong with more 3D-NAND product lines join after Unit: Million 40 Unit: GB 5, ,000 3, , , E 2017F 2018F 2019F 2020F SAS SATA PCIe E 2017F 2018F 2019F 2020F PCIe SATA SAS May, 2016 Page 26

27 Enterprise SSD Technology: 3D NAND with PCIe Samsung is leading in 3D-NAND enterprise-ssd, followed by Intel. Other NAND makers will be ready in D-NAND will be cost efficient for high-capacity products. SATA remains biggest portion while PCIe growth outperforms. SAS demand is stable for SAS HDD replacement. 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% 2016E 2017F 2018F 2019F 2020F 0% 2016E 2017F 2018F 2019F 2020F 2D NAND-MLC 2D NAND-TLC 3D NAND-MLC 3D NAND-TLC SAS SATA PCIe May, 2016 Page 27

28 China Casting in NAND Industry-1 Unigroup shows ambition investing in memory related companies ranged from manufacturing IP, backend and Flash controller houses. More potential investment cases are expected. Manufacturing IP Unigroup Packaging & Testing 15% Shares 25% Shares?? WD SNDK Other NAND Maker?? SPIL PTI Chip mos 100% Acquired Potential memory related films Central government also encourages local companies developing in-house technology or collaborate with international memory makers. XMC XMC developed 3D-NAND technology with Spansion, target for MP schedule in early SMIC SMIC developed self-own 38nm NAND Flash, SLC, already under production and sales May, 2016 Page 28

29 China Casting in NAND Industry-2 China domestic controller houses are rising to the surface with focus on PCIe products in enterprise and industrial area. Taiwan controller makers also have different approaches to China markets. China domestic controller houses Mostly focus on PCIe interface, ASIC capability is needed, so far FPGA is the common form. Phison Silicon Motion JMicron 合肥兆芯 Shannon -Sys 聯芸 ( 杭州 ) 合肥兆芯 focus on NAND storage opportunity in China market. SMI invested in Shannon, focus on enterprise SSDs 聯芸 also focus on SSD business with local opportunities China module houses strategically align with SSD controller houses to enhance the competitiveness. Longsys Marvell Longsys built SSD turnkeys backends facility in Suzhou for more SSD business May, 2016 Page 29

30 China Casting in NAND Industry-3 International NAND makers also show the great interest to invest memory manufacturing and back-end facility in China with the subsidy from central or local governments. 9% of worldwide NAND wafers will be produced in China this year. Over 20% will be produced in China by Samsung Xian Fab Xian Fab 100% dedicated for 3D- NAND, fully loaded from 2Q16 100% 80% Intel Dalien Fab Dalien Fab is converting to 3D- NAND from Chipsets, MP from 4Q16 60% 40% 20% MU PTI Xi An Back-end Fab DRAM/NAND and SSD back-end fab, JV with Micron. 0% E 2017F 2018F 2019F 2020F Others China May, 2016 Page 30

31 Key Takeaways Market Despite of over-supply dynamics in 1H16, imbalanced supply&demand will be eased from warming mobile and SSD demands in 2H16. China will plays important role in future NAND/storage industry with more coming M&A and investments NAND market dynamics could be critical with more 3D-NAND capacity joins. Supply 2016 NAND supply big growth is 46%YoY, wafer capacity increases 10%YoY. Planar NAND supply maybe constraint due to wafer conversion to 3D-NAND. TLC-eMMC and TLC-SSD continued to gain more shares. Demand 2016 NAND demand growth rate is 42%. Smartphone, tablet and SSD play the important role for growth engine. emmc market momentum is slowing down due to maturity of smartphone and tablet. SSD is the strongest application, market shares up to 34% in 2016 from 28% last year. May, 2016 Page 31

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