Plans to Advance Investment Schedule

SK Hynix's M16 Plant in Icheon, Korea

SK Hynix has expressed an intention to expand its investment in its 8-inch foundry business.

"Although there are no specific plans yet, we are discussing various ways to expand our 8-inch foundry business," an SK Hynix official said in a conference call on April 28.

System IC, a foundry affiliate of SK Hynix, has secured price competitiveness by moving its plant from Cheongju to China. The plant relocation was part of the company's move to expandi the foundry business. However, SK Hynix said that it has no plan to promote a 12-inch wafer-based foundry business or an advanced process foundry business that requires large-scale investment.

During the conference call, a question was given about whether SK Hynix would sell its stake in Japanese semiconductor company Kioxia to raise funds following the acquisition of the NAND flash business division from Intel. A company official answered that it was planning to gradually sell two-thirds of its stake in Kioxia.

Meanwhile, SK Hynix racked up 8,494.2 billion won in sales, 1,024.4 billion won in operating profit and 992.6 billion in net profit in the first quarter. Compared to the same period of 2020, its sales, operating profit and net profit swelled 18 percent, 66 percent, and 53 percent, respectively.

Although the first quarter is usually considered an off-season, the chipmaker posted an earnings surprise thanks to the favorable market conditions in early 2021.

Demand for memory semiconductors such as DRAMs and NAND flashes for PCs and mobile devices drove the chipmaker’s strong business performance. In addition, production cost competitiveness has also increased as yields of major products improved significantly. Its operating profit inflated 37 percent compared to the previous quarter.

DRAM sales increased with mobile, PC, and graphic products taking the lead. As a result, DRAM shipments increased 4 percent compared to the previous quarter. A spike in sales of high-capacity products for mobile devices pushed up shipments of NAND flashes 21 percent compared to the previous quarter.

SK Hynix believes that it has a bright outlook for the second half of 2021. The company forecasts demand for DRAMs will continue to increase and market conditions for NAND flashes will improve.

In detail, SK Hynix will supply high-capacity multi chip packages (MCPs) based on 12GB starting from the second quarter of 2021. It also decided to increase production of third-generation (1z) 10-nm products, the flagship DRAM product. It will start mass-producing fourth-generation (1a) products within 2021 by utilizing EUV technology.

In the NAND flash sector, SK Hynix emphasized that it will increase the proportion of 128-layer products in sales and start mass-producing 176-layer products within 2021.

SK Hynix decided to carry out investments originally scheduled for 2022 within 2021 in consideration of the recent growth in demand for semiconductors and problems regarding the supply of equipment in the future,

Copyright © BusinessKorea. Prohibited from unauthorized reproduction and redistribution