SK hynix posts record operating profit in 2018

One of Korea's largest semiconductor firms, SK hynix, has posted record operating profits for last year.
However, the numbers for the fourth quarter.... paint a worrying picture for the year ahead.
Our Ko Roon-hee explains.
It was another record breaking year for the world's second-biggest memory chip maker.
SK hynix posted record sales and operating profits for the second straight year in 2018.
Total sales were estimated at around 35-point-9 billion U.S. dollars,... up from the previous year's 26-point-7 billion dollars.

And more importantly, operating profits came at 18-point-5 billion dollars... up from 12-point-2 billion in 2017.

The company attributed the figures to strong sales of memory chips... due to high demand from data centers and increased production of high-performance mobile devices.

However, the numbers in the 4th quarter paint a worrying picture for this year.

During the October to December period, the operating profit dropped to around 3-point-9 billion U.S. dollars... a more than 30-percent on-quarter fall.
This is the first time since the first quarter of 2018... that the company's quarterly operating profit has been below the 4-billion dollar mark.

Analysts point to sharp declines in Chinese demand for electronic products and the recent falling orders from data centers.

For this year, falling prices is another problem.
Server DRAM contract prices are expected to drop by more than 20-percent in the first quarter of this year, according to market tracker DRAMeXchange.

Meanwhile, SK hynix's rival, Samsung Electronics, is set to release its final earnings report for 2018 next week.
Samsung had stunned the market earlier this month... with an estimated 29-percent drop in quarterly profit compared to the previous year.
Ko Roon-hee, Arirang News.