Punching Out: How to Stay Focused in Business and M&A
It’s Only Common Sense: Just Imagine…
Marcy’s Musings: Old School vs. New School—When Does It Matter?
TrendForce’s latest DRAM industry survey reveals that Micron intends to acquire PSMC’s Tongluo fab in Taiwan (excluding production equipment) for US$1.8 billion. The deal also includes a long-term partnership for future DRAM packaging services. This collaboration aims to enable Micron to increase its capacity for advanced-node DRAM while boosting PSMC’s supply of mature-node DRAM, potentially improving the global DRAM supply outlook by 2027.
According to TrendForce, starting in the second half of 2025, demand for HBM3e and DDR5—fueled respectively by ASICs and AI inference adoption—will improve overall DRAM margins, leading Micron to speed up capacity expansion. The Tongluo deal covers land, buildings, and cleanroom facilities.
Micron plans to deploy both existing and new equipment in phases during 2026–2027, mainly front-end tools for advanced DRAM manufacturing, with mass production expected in 2027. The capacity from Phase 1 at Tongluo in the second half of 2027 is projected to surpass 10% of Micron’s global capacity as of the fourth quarter of 2026.
TrendForce data showed Micron was the third-largest in 3Q25, capturing a 25.7% share of the global DRAM revenue. From 2024 onward, demand driven by AI for advanced DRAM products like HBM, DDR5, and LPDDR5X has risen significantly. Micron has responded by acquiring facilities to speed up capacity ramp-ups and expanding both its ID1 site in the U.S. and its HBM back-end capacity in Singapore.
Prior to Tongluo, Micron acquired two fabs in Tainan from AU Optronics, a fab in Taichung from AUO Crystal, and a Taichung facility from Glorytek, repurposing them for wafer probe, metallization, HBM TSV, and related uses. Micron also plans to convert portions of its Singapore NAND Flash cleanrooms to DRAM metallization.
PSMC’s current DRAM capacity mainly relies on 25nm and 38nm nodes, which restricts DDR4 production to lower-density products. Additionally, after Micron’s recent Letter of Intent (LOI), PSMC is expected to acquire a 1Y nm process license within the next year, with the possibility of obtaining a 1Z nm license in the long term. This would allow for higher-density DDR4 products, helping PSMC stay competitive in the consumer DRAM market and increase bit output, all while avoiding direct competition with Micron’s advanced product lines.
