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SK Hynix vows to triple NAND sales in 5 years after strong Q3

By Nov 04, 2020 (Gmt+09:00)

SK Hynix Inc. has vowed to triple its NAND flash memory sales within five years, buoyed by its recent acquisition of Intel Corp.’s NAND memory and storage business for $9 billion.

During a conference call on its third-quarter earnings on Nov. 4, Chief Executive Lee Seok-hee said he has high synergy expectations from the Intel deal, in line with the company's efforts to lead the market.

“Unlike in the past, when the NAND market was driven by mobile products, data centers will be the key buyer of NAND products going forward. Intel, which is a leader in the SSD (solid-state drive) market for data centers, will undoubtedly boost our presence in the sector,” he said.

According to industry tracker Omdia, SK Hynix’s NAND division posted revenue of 5.17 trillion won ($4.5 billion) in 2019.

When the Intel deal is completed by 2025, SK Hynix will be able to overtake Japan’s Kioxia Holdings Corp. to become the No. 2 player in the NAND memory market and narrow the gap with market leader Samsung Electronics Co.


Lee's ambitious target comes after the company reported on Wednesday that its third-quarter net profit more than doubled on robust mobile chip sales and increased demand from China’s Huawei Technologies Co., one of its key customers.

South Korea’s second-largest chipmaker also forecast that demand for mobile and PC chips will remain strong in the fourth quarter, signaling a steady good earnings stream for the company.

Net profit in the July-September period was 1.08 trillion won ($950 million), up 118% from 495.5 billion won a year earlier, SK Hynix said in a regulatory filing.

Operating profit jumped 175% on-year to 1.3 trillion won, while sales rose 19% to 8.13 trillion won.

SK Hynix vows to triple NAND sales in 5 years after strong Q3

Shares of SK Hynix rose 2.2% to close at 83,200 won on Wednesday, outperforming the broader Kospi market’s 0.6% gain.

The company attributed its strong performance to a recovery in memory chip prices from last year’s lows. Compared to the previous quarter, however, chip prices fell amid the COVID-19 pandemic. Its third-quarter operating profit declined 33% from the preceding quarter, with sales down 5.6% on quarter.


SK Hynix’s third-quarter results were also buoyed by Huawei’s stockpiling of semiconductors ahead of US restrictions on Sept. 15, which barred the Chinese company from buying chips made with US technology.

The earnings announcement comes a couple of weeks after the company signed a 10.3 trillion won ($9 billion) all-cash deal to buy Intel Corp.’s NAND memory chip business.

Analysts said the deal will boost SK Hynix’s competitiveness, to close in on its bigger rival Samsung. But some questioned the value of the deal.

On Wednesday, SK Hynix CEO Lee reiterated that the purchase of Intel’s NAND business was the right decision for the company and the deal price was not overvalued.

NAND flash chips made by SK Hynix
NAND flash chips made by SK Hynix


The company said robust demand for mobile chips will continue in the final quarter of this year amid intensified competition among smartphone manufacturers.

Orders for mobile chips from Chinese smartphone makers are also expected to increase as they compete for Huawei's market share.

SK Hynix said demand for PC chips is forecast to remain strong in the fourth quarter, but server demand will likely be moderate compared to the first half.

Write to Jeong-Soo Hwang and Hyung-Suk Song at

In-Soo Nam edited this article.
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