SK Hynix sees Q2 profits tripled thanks to COVID-19

Demand for memory products for server and graphic applications spurred growth.
Written by Cho Mu-Hyun, Contributing Writer
Computer memory closeup
Image: Getty Images/iStockphoto

SK Hynix has posted operating profit of 1.95 trillion won and revenue of 8.6 trillion won in the second quarter of 2020, the company said on Thursday.

It is a rise of 205% and 33%, respectively, from a year prior. Meanwhile, net income stood at 1.26 trillion won.

The COVID-19 pandemic has caused demand from mobile sectors for memory products to decline but, in turn, demand from servers and graphics sectors increased during the quarter, the South Korean memory maker said.

This helped provide strong growth for the second quarter and also resulted in an improvement in yield rates for key products and cost-cutting efforts, SK Hynix said.

The company expects the second half of the year to remain uncertain due to the pandemic and global trade wars. However, the reopening of stores in major countries coupled with overall demand for 5G smartphones, new gaming consoles, and memory is expected to rise nonetheless, the company said.

SK Hynix added that it will expand the sales of its second-generation 10nm DRAM to improve profitability and supply more LPDDR5, which have been adopted by more clients.

It will also begin production of third-generation 10nm DRAM. For NAND flash memory, it will focus on the 128-layer product.

Meanwhile, compatriot Samsung Electronics is also expecting a rise in operating profits from its memory business in the second quarter, thanks to a rise in remote work that has led to increasing demand from PCs and servers.

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