SK Hynix Posts Record Profit on Resilient Chip Demand

SK Hynix posted record profit on booming sales of memory chips and a weakening won that boosted the value of overseas sales, according to Bloomberg. Operating income rose to 5.6 trillion won ($4.9 billion) in the three months ended June.

The second-quarter results reinforce optimism that demand for memory chips remains resilient after a spike in prices led to record earnings last year. The sharp depreciation of the won in June also helped boost earnings for the South Korean company.

Sales for the second quarter climbed to 10.4 trillion won. Contract prices for 32 gigabyte DRAM server modules climbed 2.8 percent in the June quarter from the March period, which saw them rise 5.6 percent. Prices for 128 gigabit MLC NAND flash memory chips fell about 9 percent, according to inSpectrum Tech Inc.

Samsung leads Hynix in the DRAM market and Hynix is looking to the fast-growing NAND flash memory market to boost its profile. The company is also forging ahead with investments to boost production to meet what it expects to be resilient demand for memory chips. The company’s capital expenditures next year are forecast to be slightly less than this year.

Hynix faces an investigation over allegations of collusion in chip sales with Samsung and Micron in China. In a bid to appeal to Chinese consumers, Hynix said earlier this month that it would set up a foundry in Wuxi, China next year in a joint venture with the investment arm of the local government.