Etron Technology has posted staggering losses for the first three quarters of 2008.

The SDRAM specialist reportedly lost $9.65 million, with negative earnings per share of NT $0.75. In addition, the company recorded a monthly revenue drop to NT $571 million because of a significant decline in average selling prices.

Elite Semiconductor Memory Technology (ESMT) and Zentel Electronics have also been affected by the global economic recession. ESMT's October sales dropped 10.2 per cent to NT $378 million, while Zentel, a subsidary of Powerchip Semiconductor Corporation (PSC) suffered a revenue decrease to below NT $400 million.

As IT Examiner previously reported, Taiwanese president Ma Ying-jeou has attempted to downplay a serious decline in IT exports. The president emphasised that the country's high-tech industry would have the opportunity to "experience prosperity" in 2009, despite recording negative growth. However, Ma admitted that exports had declined as markets in the US, Europe and China contracted. Nevertheless, the president reiterated that Taiwan's technology sector remained sound and would eventually recover with government assistance.

Vice president Vincent Siew expressed similiar sentiments, and insisted that Taipei would not abandon the memory industry, which currently accounts for 30 per cent of global supplies. Siew also encouraged the industry to "consolidate".

"If our DRAM industry in Taiwan can't take advantage of this opportunity and upgrade and become more competitive, even without the financial crisis, you can't survive," Siew told an American Chamber of Commerce meeting.

The slump in the price of DRAM has prompted the government to provide local manufacturers with financial aid. Taiwan has also granted embattled firms six months grace from creditors as well as bank loan extensions. Nevertheless, pessimistic market analysts continue to project significant losses for the industry and predict a total yearly deficit of $3 billion. For example, South Korea's Hynix Semiconductor lost over $1 billion during the third quarter of 2008, while US-based Micron Technology recorded quarterly losses of US $344 million.

The grim outlook for memory manufacturers is not expected to improve any time soon. Analysts estimate a sequential drop of approximately six per cent, or 70,000 wafers (12-inch equivalents), in overall DRAM output during the first quarter of 2009. This could force large Korean manufacturers to formulate cost-cutting alliances with Taiwanese companies.

Pai Pei-lin, VP and spokesperson of Nanya Technology, blamed low-end devices such as the Eee PC and Netbook for negatively affecting sales.

"The more these gadgets sell, the worse off the DRAM industry becomes," Pei-lin told the Taiwan Journal. X

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