The world’s second largest memory chipmaker SK Hynix Inc. on Tuesday posted stronger-than-expected earnings in the third quarter thanks to recovery in chip prices and expectations for strengthening in demand.

The company in a regulatory filing Tuesday reported operating profit of 726 billion won ($640.5 million) in the three months ended September, up 60.3 percent from the previous quarter and down 47.5 percent from the previous year. The figure came well above the market estimates ranging between 670 billion won and 680 billion won.

Net profit reached 597.8 billion won in the quarter, up 108.9 percent on quarter and down 43 percent on year, while revenue totaled 4.2 trillion won, up 7.7 percent from the previous quarter and down 13.8 percent from a year ago.

The company said its third-quarter operating profit has improved from the previous quarter following rebound in the average selling price of its chip products and the expansion of its 2Z-nanometer chip fabrication process that also helped cut costs. A series of new mobile device launches and steady demand from the personal computer (PC) segment have largely contributed to an increase in chip prices, the company added.

Dynamic random access memory (DRAM) chip bit shipments in the third quarter rose 8 percent on quarter, thanks to increased inventory stocking orders from PC original equipment manufacturers (OEMs) to prepare the year-end peak season for PC sales on top of the launches of new mobile devices with higher DRAM densities, the company said. The average selling price for DRAM stayed flat, but sustained a positive trend.

NAND flash bit shipments and average selling price jumped 12 percent and 7 percent, respectively, over the cited period, with more new mobile devices employing NAND flash chips with higher densities.

SK Hynix forecast DRAM chip prices would continue to climb backed by strong demand, while demand for NAND flash also keep upward on recovery due to release of new smartphone models. The solid state drive market is also expected to remain solid led by the steady rise in PC demand.

Shares of SK Hynix ended Tuesday at 41,050 won, up 900 won or 2.24 percent, from the previous session.

By Lee Dong-in

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