SK Hynix profit falls as smartphone, PC sales slow

SK Hynix, a supplier of memory chips to Apple, posted a slump in second-quarter profit as semiconductor prices dropped on slack demand for smartphones and personal computers.

Operating income fell 67 percent to 452.9 billion won ($398 million) in the three months ended June, the Icheon-based company said on Tuesday. That compares with the 454.3 billion-won average of analyst estimates compiled by Bloomberg. Shares fell 1.38 percent to end at 32,050 won.

Deteriorating demand for smartphones saw the average selling price of benchmark DDR3 4-gigabit dynamic random access chips drop to $1.58 in the quarter, 47 percent below the year earlier, according to InSpectrum Tech.

SK Hynix said Tuesday that demand for DRAM chips will surge in the current quarter, driven by new mobiles. Apple, Hynix’s biggest customer, typically releases new iPhones in September.

“Rebounding demand is the biggest issue now and the continued fall in the chip prices have reflected that missing demand,” Song Myung Sup, a Seoul-based analyst at HI Investment& Securities, said before the announcement.

Apple accounts for more than 9 percent of SK Hynix’s revenue, according to data compiled by Bloomberg.

Net income excluding minority interest slumped 74 percent to 286 billion won after a loss in foreign exchange, the company said. Sales for the quarter were 3.94 trillion won. Bloomberg