SK Hynix announced Tuesday that it posted record-high earnings in the third quarter this year thanks to rising DRAM prices and increased NAND Flash bit shipments for the release of new mobile devices.

The chipmaker earned 1.16 trillion won ($1.09 billion) in operating profit and 4.08 trillion won in revenue during the period, up 5 percent and 4 percent, respectively, from the second quarter this year.

The operating margin stood at 29 percent, slightly up from the second quarter’s 28 percent, with the help of a favorable market environment as well as process technology migration and yield improvement, the company said.

Net income for the third quarter was 958 billion won reflecting non-operating expenses, slightly up from 947 billion won in the second quarter.

Kim Joon-ho, the president of SK Hynix’ corporate center, said in a conference call that “the development of 2Ynm DRAM and 1Xnm NAND Flash has been finished and the mass production of the products is under way.”

He said 2Ynm DRAM is currently being manufactured, and the firm is working on the 2Znm DRAM. The sample 2Z chip will be available next year.

The letters X, Y, and Z indicate high-, mid-, and low-single digits and become smaller in the alphabetical order.

The bit growth, which indicates an increase rate of memory production, of the firm for DRAM and NAND flash will be around mid-20 percent and mid-40 percent, respectively, next year, similar to the market averages, James Kim, vice-president and head of investor relations and public relations.

“The production of DRAMs for mobile devices is expected to exceed that for PCs next year,” said the president, adding “the proportion of mobile DRAMs will stand at mid-20 percent in the second quarter, 30 percent in the third and the fourth, and reach 40 percent in 2014.”

The firm forecasted a rising demand of DRAMs for “2-in-1” PCs, a cross between a laptop and a tablet, and servers.

The Korean chipmaker, however, predicted the pace of the bit growth would slow down after the 2Ynm memory as more advanced facilities and investment are required for developing a more sophisticated chip.

“The restoration works on ventilation facilities and clean rooms at Wuxi plants are almost in the final phase,” said president Kim adding, “the plants will be normalized next month.”

A fire broke out last month at the chip maker’s Wuxi plants in China, where SK Hynix produces half of its DRAM production.

On the same day, SK Telecom also announced record-high quarterly earnings with its operating profit standing at 551.4 billion won, and revenue, 4.13 trillion won, in the third quarter.

The revenue edged up 0.2 percent compared to the second quarter, thanks to the growth of average revenue per user and new business areas including enterprise solutions, while the operating profit increased 1.1 percent compared to the preceding quarter.

As of the end of September this year, the number of LTE subscribers of the mobile carrier marked 12.3 million, accounting for 45 percent of the company’s total mobile subscription.

“Going forward, armed with strong network competitiveness and specialized services, SK Telecom will lead the migration toward an era where data communication becomes the mainstream, while promoting a health competition in the marketplace to attain sustainable growth and maximize shareholder value,” SK Telecom’s chief financial officer Hwang Soo-cheol said


By Kim Young-won
(wone0102@heraldcorp.com)