By Joyce Lee and Hyunjoo Jin

SEOUL (Reuters) -South Korea’s SK Hynix on Thursday posted a record quarterly profit as the Nvidia (NASDAQ:) supplier saw strong sales of advanced chips such as high-bandwidth memory (HBM) used in generative artificial intelligence chipsets.

The quarterly operating profit of 8.1 trillion won ($5.64 billion) from the world’s second-biggest memory chipmaker exceeded its bigger rival Samsung Electronics (KS:)’ forecast December-quarter operating profit of 6.5 trillion won.

This is the first time that SK Hynix’s quarterly operating profit beat Samsung’s total operating profit, analysts said, as its rival lags in supplying high-end HBM chips to Nvidia.

“Demand of HBM and high-density server DRAM… will continue to increase as global big tech companies’ investment in AI servers grows and AI inference technology gains importance,” SK Hynix said in a statement.

The company said its HBM chips accounted for 40% of its total DRAM revenue in the fourth quarter. Overall, its revenue for the quarter rose 75% year-on-year to 19.8 trillion won.

SK Hynix’s operating profit result was slightly above the 8 trillion won average forecast by LSEG SmartEstimate, which is weighted toward analysts who are more consistently accurate, and up from 346 billion won a year earlier.

SK Hynix has been increasingly outperforming rivals Samsung and U.S.-based Micron Technology (NASDAQ:) in recent quarters, as it benefits the most from AI-driven appetite for high-end memory chips following its early entry and large investments in HBM chip development.

SK Hynix said it began supply of 12-layer HBM3E chips, the most advanced HBM model currently in mass production, to a customer in the fourth quarter.

The company’s shares have jumped about 30% so far this year on bullish sentiment driven by its business discussions with Nvidia, outperforming Samsung, whose shares rose 2% over the same period.

SK Hynix’s shares benefited on Tuesday from U.S. President Donald Trump’s announcement of private-sector investment of up to $500 billion to fund infrastructure for AI.

© Reuters. The logos of SK Hynix is seen at its headquarters in Seongnam, South Korea, April 25, 2016. REUTERS/Kim Hong-Ji/File Photo

For the conventional memory chip market, customers are expected to reduce inventory of PCs and smartphones, SK Hynix said. “Sales of PCs and smartphones equipped with AI will expand and the market situation will pick up in the second half of the year,” it added.

($1 = 1,435.1200 won)


Source link

Best Brokers

Unmatched trading fees, generous bonuses, top notch Regulation Frame.

T&Cs Apply

Risk disclosure: All investments involve a degree of risk of some kind. Trading financial derivative products comes with a high risk of losing money rapidly due to leverage.

Top-Tier Regulations. Unmatched Spreads and Commissions. Trading View is available.

T&Cs Apply

Financial Spread Trades and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84.7% of retail investor accounts lose money when trading CFDs with this provider.

Modern and Intuitive Interfaces, Solid Regulatory Frame, and excellent Trading Fees.

T&Cs Apply
Risk warning: Trading derivatives is highly speculative, carries an inherent risk of loss and is not suitable for all investors. Before trading, you are strongly advised to read and ensure that you understand the relevant risk disclosures and warnings.

Highly Regulated. Low Spreads and Commissions. Vast Account Options.

T&Cs Apply

Risk Warning: Trading derivatives carries significant risks. It is not suitable for all investors and if you are a professional client, you could lose substantially more than your initial investment.