SK Hynix Memory’s Q3 operating profit fell 33% month-on-month

On November 4, SK Hynix released its financial report for the third quarter of fiscal year 2020. In the third quarter, the company’s consolidated revenue was 8.129 trillion won, operating profit was 1.3 trillion won, and net profit was 1.078 trillion won. The operating margin for the quarter was 16% and the net profit margin was 13%.
 
According to SK hynix's analysis, although mobile memory demand showed a recovery trend this quarter, the weak demand for server DRAM and solid state drives led to weaker overall memory market prices this quarter. The company's revenue and operating profit in the third quarter were compared with the previous quarter. Reduced by 6% and 33% respectively.
 
In this quarter, the company not only actively responded to the additional demand for mobile terminal and graphics DRAM, but also successfully digested the DRAM demand for some customers such as home appliances, offsetting the weak demand of server DRAM customers, and its DRAM bit shipments (Bit shipments) increased by 4% from the previous quarter. However, the decline in the price of server DRAM and other memory has caused the company’s average selling price (ASP) to decrease by 7% from the previous quarter.

 
Regarding NAND flash memory, the company has successfully expanded related sales to help mobile demand and SSD demand for next-generation game consoles. Its NAND bit shipments increased by 9% month-on-month. However, due to the weak price of server NAND flash memory, the company’s NAND flash memory The average selling price dropped by 10% from the previous month.
 
SK hynix expects that while mobile memory demand continues to be seasonally strong in the fourth quarter, the PC memory market will also maintain a solid demand this quarter.
 
On the one hand, the company will focus on responding to mobile demand through measures such as expanding the sales of the second-generation 10 nanometer (1Ynm) LPDDR5 DRAM, and strive to expand its influence in the uMCP (UFS-based multichip package) market. At the same time, the company will increase the proportion of sales of high-capacity server products exceeding 64GB (Gigabyte) and maximize the sales of high bandwidth memory (HBM) products, and expand its position in the server DRAM market with its competitive advantages in quality .
 
On the other hand, while actively responding to the demand for NAND flash memory from mobile clients, the company further expanded the sales proportion of 128-layer NAND flash memory products that it started selling in this quarter to continuously improve the company's overall profitability.