Taipei, Oct. 7, 2008 (CENS)--Market collapse has caused revenue of Taiwan`s dynamic random access memory (DRAM) chipmakers to slump steeply in September, with PowerChip Semiconductor Corp. (PSC) posting the worst plunge.

PSC had revenue of NT$3.8 billion (US$119 million at US$1:NT$32) in September, contracting 24.15% from a month earlier and 17.15% year on year. The yearly-basis drop pace sets a new low in three years.

PSC`s spokesman, C.M. Tang, said tepid chip demand at retail market forced prices of standard DRAM chips to further drop in September, leading to the company`s sales slump for the month. In the first nine months this year the company raked in total revenue of NT$47.2 billion (US$1.4 billion), declining 26.7% year on year. As retail prices of the chips have dropped below costs, the company has cut output to reduce losses.

ProMOS Technologies Inc. scored revenue of NT$2.6 billion (US$83 million) in September, shrinking 15% from a month earlier and 24.3% from a year earlier. To reduce loss, the company has announced it will phase 200-mm wafer fabs out of production and cut output by 10 to 15%.

ProMOS raked in revenue of NT$26.5 billion (US$828 million) throughout the first three quarters this year, losing 31.91% from the same period of last year.

Nanya Technology Corp. is estimated to see its revenue for September decline 15% to 20% from a month earlier, its steepest single month drop in the third quarter.

Industry watchers pointed out that average DRAM prices on spot market and contract market have dropped over 15%. To shore up the market, PSC, ProMOS, Elpida Memory and Hynix Semiconductor have launched output-cut plans. Industry watchers expected these moves to help bring back market recovery soon.

Industry watchers estimated Hynix`s cut to account for 3% to 3.5% of world`s total output and the combined cut by PSC and Elpida to represent 5-6% of global output. They estimated a total of 8% to 10% cut worldwide could help recover the market.

They are inspired by Micron Technology, which is planning to slash 2009 capital expenditure to US$1 billion from originally planned US$1.3 billion. Its 2008 spending is US$2.9 billion and 2007 outlay was US$4.1 billion.

(by Ken Liu)