After benefiting from the growing non-contact market in the wake of the COVID-19 outbreak in the first six months of this year, chipmakers are again faced with a bearish outlook for the remaining half of the year due to estimated falls in chip prices.

In the third quarter, there are predominant forecasts that say the prices of both DRAM and NAND flashes will decline, leading to a slower growth of the overall memory market.

According to market tracker DRAMeXchange, the fixed price of DDR4 8-gigabit has stopped its five-month rising streak.

Some market watchers say demand for memory already surged in the second quarter as server companies were securing products in advance in preparations for possible demand in the latter half of the year.

This would lead to better earnings for the Korean chipmakers in the second quarter.

SK hynix is expected to log 8.29 trillion won ($6.9 billion) in sales in the April-June period, up 28.6 percent from a year earlier, while its operating profit was estimated to surge 166 percent on-year to 1.7 trillion won over the period, according to data from local brokerage houses.

Analysts said robust chip demand from data centers, sparked by the pandemic-driven stay-at-home economy, has led to a big jump in second-quarter earnings.

Samsung Electronics is expected to log 53.39 trillion won in sales in the second quarter, down 5.5 percent from a year earlier, while operating profit was estimated to drop 2.3 percent on-year to 6.44 trillion won over the period.

However, analysts have been raising their earnings outlook for Samsung in recent weeks as demand for server chips sparked.

After having a better-than-expected quarter, the memory chip providers will face a downturn again in the coming months, reports say.

Market watchers predict that fixed prices of server DRAMs will fall more than 5 percent compared to the second quarter.

NAND flashes would decline in price, too. But analysts say the declines would be narrower than those of DRAM prices.

A recent report by TrendForce said NAND price falls would be less than 5 percent.

“Launches of new console games like PS5 and XBOX Series X would be a growth momentum for NAND prices,” said a report released by Eugene Securities.

“The NAND business would help chipmakers make up for the slowing DRAM business in the third quarter,” said a report by Daishin Securities.

Samsung is currenlty working to ramp up its NAND production both in Pyeongtaek and Xian, China, as the tech giant has announced it is preparing to respond to the growing NAND demand.

By Song Su-hyun (song@heraldcorp.com)