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SK hynix Anticipated to Dominate HBM Market with Further Decrease in NAND Production

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n the second quarter, both Samsung Electronics and SK hynix experienced losses, continuing their challenging performance from the first quarter. The cumulative deficit for both companies in the first half of the year reached nearly 15 trillion won. However, there is optimism for a potential turnaround in the latter half of the year, driven by a reduction in NAND flash memory production and an increase in demand for high-value AI-related products.


SK hynix reported an accumulated loss of over 6 trillion won in the first half of the year, with a significant drop in revenue of 47.1 percent compared to the same period last year. Samsung Electronics is also expected to announce losses in its second-quarter results. Despite these ongoing losses, industry experts believe that the semiconductor market is entering a recovery phase, as evidenced by the gradual reduction in the rate of operating losses.


In response to the performance deterioration, SK hynix plans to further reduce NAND flash production by 5 to 10 percent. This reduction is seen as a measure to enhance profitability. Additionally, SK hynix is focusing on supplying high-value products like High Bandwidth Memory (HBM) to improve profitability and boost sales. The company plans to commence mass production of the fifth-generation HBM in the first half of next year.


Overall, while both Samsung Electronics and SK hynix faced losses in the second quarter, there is hope for a turnaround in the latter half of the year. The reduction in NAND flash production and the increased demand for high-value AI-related products are expected to contribute to the recovery of the semiconductor market. SK hynix is implementing measures to enhance profitability and focus on supplying high-value products like HBM.

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