South Korea’s SK Hynix Inc, the world’s second-largest memorychip maker, yesterday reported a 95 percent quarterly profit plunge, as it suffers from a long-running lull in the global market.
The East Asian nation’s chip manufacturers — led by behemoth Samsung Electronics Co — have enjoyed record profits in recent years as prices for their products soared.
SK Hynix supplies chips to companies from US giant Apple Inc to China’s Huawei Technologies Co (華為), but demand began to decline and supply increase after manufacturers invested billions in new factories.
Its operating profit dropped 95 percent to 236 billion won (US$198 million) year-on-year in the October-to-December period, the company said in a statement.
The firm also recorded a net loss of 118 billion won, while sales fell 30 percent to 6.9 trillion won.
For the full year, net profit was 2.01 trillion won, down 87 percent from the previous year.
The manufacturer has been strained by a trade dispute between China and the US, and caught in a diplomatic row between Seoul and Tokyo over wartime history, with Japan in July last year imposing tough restrictions on exports crucial to South Korean tech giants.
“The increase in inventory burden and conservative purchasing policies on the side of customers led to a slowdown in demand as well as price falls,” the chipmaker said.
The company will “carry out more prudent production and investment strategies, as complexities and uncertainties still remain much higher than in the past,” it added.
Weakening overseas demand for memory chips — one of South Korea’s key trade items — is bad news for the nation’s export-driven economy.
Rival Samsung faces similar challenges and reported a 38 percent fall in net profit for the October-to-December period.
However, Avril Wu (吳雅婷), an analyst at the Taipei-based market tracker TrendForce, forecast that there would be an improvement in the company’s profitability in the first quarter of this year.
“We expect both DRAM and NAND Flash average selling prices to rise, while the cost of goods sold has no reason to increase as far as we know,” she added.
Shares of SK Hynix yesterday closed down 0.53 percent in Seoul.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last