SEOUL (Reuters) - South Korea’s SK Hynix Inc said on Thursday third-quarter operating profit leapt more than five-fold to a record, matching market expectations, on rocketing demand for memory chips for servers and smartphones.
The world’s second-biggest memory chip maker behind Samsung Electronics Co Ltd made a bigger profit in the quarter than it did in all of last year, as a “super-cycle” of tight supply and soaring demand drives chip margins.
For the current quarter, SK Hynix expected shipment growth in both DRAM and NAND, as data centres demand more server DRAMs, and year-end smartphone demand drives up mobile NAND sales.
Next year, SK Hynix said industry-wide DRAM shipments could grow by around 20%, while NAND shipments could grow by mid-30%.
“DRAM supply will not suddenly increase, and investments on artificial intelligence and big data aren’t likely to decrease any time soon,” said Lee Seung-woo, analyst at Eugene Investment & Securities.
All DRAM product prices have risen for three consecutive quarters, SK Hynix said.
Profit for July-September rose to 3.7tn won ($3.28bn) from 726bn won a year ago, SK Hynix said, compared with a 3.8tn won Thomson Reuters StarMine SmartEstimate with 20 analysts surveyed. Revenue rose 91% to 8.1tn won.
SK Hynix is on track for what analysts estimate to be its largest-ever annual operating profit of 13.6tn won. Samsung is also expected to book record quarterly profit for the three months through September on 31 October.