SK Hynix sees profits more than double in 1Q22

Jessie Shen, DIGITIMES, Taipei 0

Credit: AFP

SK Hynix has reported operating profits jumped 116% from a year earlier to KRW2.86 trillion (US$2.26 billion) in the first quarter of 2022 when revenue climbed 43% on year to KRW12.16 trillion.

"The quarterly revenues of more than KRW12 trillion in the low season of the January-March period top those of the first quarter of 2018 when memory industry enjoyed one of the best times," SK Hynix indicated. "A smaller-than-expected fall in memory chip prices and revenues of Solidigm, which was incorporated as SK Hynix's subsidiary at the end of 2021, contributed to the earnings."

The operating profit results were also "the best performance for the first quarter since 2018," SK Hynix continued.

"Consumption of some IT products slowed down from the start of the year amid ongoing challenges including the supply chain issue," SK Hynix said. Nevertheless, the company managed to generate handsome earnings in the first quarter as it "responded to customer demand in a flexible way while focusing on profitability management."

SK Hynix also set aside KRW380 billion for compensation over quality issues in some DRAM products sold previously, with the one-off provision reflected in its financial results for first-quarter 2022, the chipmaker disclosed.

SK Hynix has been improving yield rates for its 1anm DRAM process node, which is the fourth generation of the company's 10nm-class process technology, and 176-layer 4D NAND process, it noted. "We will strive to meet customer demand by continuing to improve the yield rate despite a difficulty in the supply of the equipment," said company chief marketing officer Kevin (Jongwon) Noh.

The overall memory industry conditions will be improving in the second half of 2022, buoyed by a ramp-up in demand for server applications, according to Noh.