Saturday, November 17, 2018
SK Hynix to Further Widen Gap with Competitors in NAND Flash Sector
Mass-production of 96-layer NAND Flashes
SK Hynix to Further Widen Gap with Competitors in NAND Flash Sector
  • By Michael Herh
  • September 5, 2018, 13:42
Share articles

SK Hynix invested 15 trillion won (US$13.5 billion) in building the M15 plant in Cheongju, which will produce 72-layer and 96-layer NAND flashes.

SK Hynix will speed up mass production of fifth-generation 96-layer 3D NAND flashes as the M15 Semiconductor Plant has been completed. A ceremony will be held in Cheongju on September 17 to mark the completion of the plant. SK Hynix plans to solidify its market dominance by ramping up the production 96-layer NAND flashes beginning early next year.

According to the semiconductor industry on September 3, SK Hynix completes the M15 plant six months earlier than originally planned to cope with sudden big changes in the NAND market. "Samsung Electronics began to mass-produce 96-layer products in July. Toshiba and Micron are scheduled to follow suit," said an analyst of the semiconductor industry. “SK Hynix moved up the completion date due in part to Chinese companies’ aggressive marketing in the NAND flash market.”

SK Hynix invested 15 trillion won (US$US$13.5 billion) in building the M15 plant in Cheongju, which will produce 72-layer and 96-layer NAND flashes. Unlike DRAMs, NAND flashes are non-volatile memory semiconductors that do not lose data even when power is turned off.

Mass production of 96-layer products is quite meaningful in that it proves SK Hynix's advanced technology to the world. It is also expected to help expand SK Hynix's NAND market share, which placed fifth after Samsung Electronics (38.2%) and Toshiba (18.5%) among others in the first quarter.

Mass production of 96-layer products can make the profit structure of SK Hynix more balanced. It is currently lopsided toward DRAMs. Last year, the company’s operating profit in the DRAM sector accounted for 90% of its total operating profit, with the NAND sector's share being less than 10%. In comparison, Samsung Electronics generates 63% of its operating profit from the DRAM sector and 32% from the NAND sector.

Competition among memory semiconductor companies of Korea, the US and Japan over 96-layer NAND flashes is expected to further intensify. Toshiba announced in June that it completed the development of 96-layer NAND flash technology with Western Digital. Toshiba is expected to produce 96-layer NAND flashes by the end of this year at the earliest or next year at the latest. Micron plans to complete the 96-stage NAND development this year through technology cooperation with Intel. "A supply glut seems to be possible in the NAND sector where the technology gap is wider than in the DRAM sector,” said an official of the semiconductor industry. “Next year, companies’ profitability in the NAND flash sector may fell from this year."