亚洲科技：内存价格对智能手机行业的历史启示

Asia Tech: What history tells about memory pricing impact on The recent memory price rally has raised concerns about the smartphone OEMs’ profitability,and the impact on other smartphone components’ budgets. This note examines the historicalcorrelation between memory price and the profitability of Android OEMs (Xiaomi, Transsion) Alex Wang, CFA+852 2123 2613alex.wang@bernsteinsg.com Mark Li+852 2123 2645mark.li@bernsteinsg.com Strong demand from AI has led to a strong memory cycle since 2Q25:Data fromTrendForce & our checks both suggest that 4QCY25 mobile DRAM contract price likely willrise around 30-40% QoQ (memory tracker). While no contract is signed yet, the price increaseis likely to sustain into 1HCY26, maybe at a similar or slower than in 4QCY25. NAND pricingincrease is milder, but is also likely to increase by HSD% QoQ in 4QCY25. Overall, with strongdemand from hyperscalers for AI, suppliers are very adamant on price increases currently, and Eunice Lee, CFA+852 2123 2606eunice.lee@bernsteinsg.com Shirley Yang, CFA+852 2123 2660shirley.yang@bernsteinsg.com Rising memory prices impact low-to-mid-end smartphones more than flagshipmodels.Memory accounts for about 4% of an iPhone’s ASP, 7% of a Xiaomi flagship, andover 10% of a Redmi model’s ASP (as of 3Q25). For Xiaomi, a 40% memory price increasecould reduce smartphone gross margins by 2-3 percentage points. Xiaomi may pass somecost hikes to consumers, as it is preparing for a prolonged memory price increase cycle,though it will potentially affect volume. However, Xiaomi’s shift toward premium models may Ethan Xu+852 2123 2634ethan.xu@bernsteinsg.com Edward Hou, CFA+852 2123 2623edward.hou@bernsteinsg.com Yipin Cai, CFA+852 2123 2669yipin.cai@bernsteinsg.com Historically, memory pricing is less correlated to camera lens margin, but has adelayed impact on the camera module. Apple's supply chain is safer than Android’s. Mika Fu+852 2166 4805mika.fu@bernsteinsg.com Likely because the camera lens market is more consolidated than the module market, and thetech threshold is higher, we observe less GM impact from rising memory pricing in the lensmarket. Overall, the profit pool of the camera industry relies on camera specs, smartphonedemand, and competition. We expect the current memory upcycle to negatively impact Our bear case for Sunny Optical (OP) suggests these concerns are overdone.In thisscenario, we assume no revenue growth for smartphone segment. Over 30% /45% ofsmartphone module/lens revenue comes from high-end products, which we assume theprofitability to be stable next year. However, the rest of the products are modeled to seemargin deterioration. As a result, our bear case suggests a6% and 1% growth for revenue/EPS next year, respectively, which is 8%/10% below consensus.Applying 22x P/E INVESTMENT IMPLICATIONS We rate Sunny Optical Outperform, PT=HK$110.We rate Largan Market Perform, PT=NT$2400.We rate Xiaomi Outperform, PT = HK$57.00.We rate MediaTek Outperform with PT NT$1,600.00.We rate Samsung Electronics Outperform with price target of KRW 95,000.We rate SK hynix Outperform with price target of KRW 400,000.We rate Micron Outperform with price target of US$ 170.00.We rate KIOXIA Underperform with price target of JPY 3,500.00. DETAILS The recent memory price rally has raised concerns about the smartphone OEMs’ profitability, and the impact on other smartphonecomponents’ budgets. This note examines the historical correlation between memory price and the profitability of Android OEMs Rising memory price has a higher impact on low-to-mid-end smartphones, but minimal impact on high-end models. Memory is one of the largest contributors to the BOM in a smartphone, after SoCs, display, and camera modules. For an Androidflagship like Xiaomi 17 Pro (starting c.RMB 5K/US$700), memory represents 7%, but the mix will be low-teens for low-to-mid-end products under Redmi (<US$400). On the contrary, for an iPhone 17 Pro Max (starting c.US$1200), memory only represents4% of the ASP. Given Apple’s focus on the high-end segment, and it can also leverage software offerings to improve corporate Both Xiaomi and Transsion expanded their gross margin (GM) during the last memory downcycle (2H22-1H23), andexperienced margin pressure in 1H24 when memory prices increased.There are many factors that impact the profitability ofsmartphone OEMs, including smartphone product mix (premiumization trend?), scale effect (overall market growth? market sharetrend? ), and component cost (e.g., memory pricing). Exhibit 6 shows that the Smartphone (ex-iPhone) market has been saturatedsince the late 2010s. Annual shipment fluctuates and is being affected by events including the Huawei ban (full impact in 2021), •Memory downcycle (3Q22-2Q23):In the last downcycle, smartphone DRAM (LPPDDR4X) and NAND (256GB UFS) pricesdecreased by 51%/49% starting from 3Q22. The overall smartphone (ex-iPhone) market experienced a deep correction inthat period. However, Xiaomi’s sm