As highly expected amid boom in the memory market in line with the rapid pace of digitalization and automation, the world’s second largest memory chipmaker SK Hynix Inc. Tuesday delivered its best-ever income statement in the second quarter and vowed to ramp up capacity to meet unfazed demand.

In the quarter ended June, Korea’s second largest chipmaker posted an operating profit of 3.05 trillion won ($2.73 billion), gaining 23.6 percent from the previous biggest figure in the first quarter. Sales increased 6.4 percent on quarter to reach 6.69 trillion won. It generated a net profit of 2.47 trillion won.

The company beefed up output of its mainstay dynamic random access memory (DRAM) for PCs by 3 percent in the second quarter from the previous three-month period to meet demand. Average selling price (ASP) gained 11 percent on quarter.

Shipment of NAND flash slipped 6 percent on quarter due to softening in smartphone demand. Its ASP rose 8 percent due to broader demand.

As of 11:35 a.m., shares of SK Hynix fell 2 percent to 71,600 won in correction after pre-earnings gains.

Demand will overwhelm capacity throughout the year, translating into higher ASP in the second half as well, said Lee Seok-hui, chief operating officer at SK Hynix during a conference call.

The chipmaker will bolster 3D manufacturing, expecting greater demand for high memory storage to power multi-functional smartphones, he said.

“We cannot keep up with demand from mere transition of DRAM processing technology. We would have to beef up facility investment,” he said.

The chipmaker will expand facility in both DRAM and flash by the end of the year and also plans to speed up construction of new facilities in Wuxi, China, and Cheongju in Korea to have them completed by the fourth quarter of 2018 instead of the original plan of the first quarter in 2019.

It plans to expand the mass production of the high-end mobile LPDDR4X and also start mass producing 1Xnm DRAM in the second half as planned. It will also begin manufacturing 3D NAND flash in full scale from the new M14 fab and supply mobile solutions and client solid state drives (cSSDs) in 72-layer 3D NAND by the end of the year, followed by enterprise solid state drives (eSSDs) next year.

By Lee Dong-in

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