NAND flash market expected to recover in 2013 despite Ultrabooks stumble

Revenue for the global NAND flash memory market should be able to recover in 2013, according to a new report from IHS iSuppli.

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The market intelligence firm recapped on Tuesday that this segment's revenue dropped in 2012 by seven percent to $19.7 billion.

The primary culprit cited by IHS researchers was less-than-expected results for Ultrabooks worldwide, which in turn hampered various supply chain partners.

Such mishaps, along with overall muted demand, prompted the NAND industry to slow production midway through 2012. Suppliers took action to prevent what would have been a disastrous year for all, and a shrewd move to stabilize pricing in August ultimately led to a minor rally in October. Even so, the second half last year turned out to be weaker than expected despite solid results in the third quarter, blunting growth and resulting in the contraction of industry revenue by the end of last year.

Despite a more optimistic outlook for the year overall, analysts still warned that the first six months of 2013 will still be a bit rough.

One of the only reasons that the financial bleeding might not have been worse, according to IHS, was strong demand for Apple's iPhone.

To put this in perspective, IHS highlighted that iPhones consumed 10.5 percent of the total NAND flash supply in 2012, while all other smartphones combined used 10.4 percent.

Michael Yang, a senior principal analyst covering memory and storage at IHS, cited in the report that Apple's iPhone line in 2012 was "the largest single consumer of NAND" because of its "high-memory density, combined with high-volume shipments."