Growth in DRAM bit demand will outpace bit supply growth in 2018, according to Wu Chia-chau, chairman for chipmaker Nanya Technology.

DRAM bit demand is expected to increase 22% in 2018, while growth in the bit supply will reach 21%, said Wu.

Nanya will enjoy another year of business growth in 2018, Wu noted. The DRAM chipmaker saw its net profits climb to a record high of NT$40.29 billion (US$1.38 billion) in 2017, with EPS also hitting a record high of NT$14.36.

Nanya's 2017 profitability was buoyed by the company's transition to 20nm process technology, favorable market conditions and the sale of Micron Technology shares, Wu indicated. The company will continue to expand its 20nm chip output in 2018, when its bit shipments are forecast to climb 48% on year, Wu said.

Nanya posted EPS of NT$2.39 in the first quarter of 2018. The company is confident about its profitability particularly operating income this year, according to Wu.

Wu also commented that smartphones remain the largest market for DRAM memory. Nevertheless, growth in demand for servers and datacenters has already surpassed that in demand for smartphones. Wu said.

On the supply side, major DRAM chip suppliers intend to grow their output through technology advancements rather than production capacity build-ups, Wu identified. Growth in the bit supply has become moderate enabling the market conditions to remain favorable to suppliers, Wu said.