Memory packaging and testing firms Powertech Technology (PTI) and Walton Advanced Engineering both expect their fourth-quarter revenues to be lower than the levels recorded in the third quarter as upstream memory chipmakers have continued to cut back production, according to sources at the companies.
DK Tsai, chairman of Powertech said earlier that he was not positive about the memory business for the second half of 2011, with the degree of slump comparable to in 2008 when the overall IT industry was hit by the global financial crisis.
Order visibility for the fourth quarter is unclear, and it will probably take 3-6 months for the memory industry to clear out inventory, which means that demand may take an upturn within a six-month period, Tsai stated.
With demand for memory products from the smartphone and tablet PC sectors remaining strong and demand from the mobile telecommunications segment continuing to grow, the current imbalance between supply and demand is temporary and overall demand will rebound in the first half of 2012, commented Yu Hong-chi, president of Walton.
The prospects for mobile RAM chips still look promising, while the growing cloud computing industry will drive a turnaround for the memory industry, Yu asserted.