Boom in Artificial Intelligence to Drive Chip Profits, Says SK Hynix
Leading memory chipmaker SK Hynix has reported a narrower third-quarter loss, thanks to a surge in demand for advanced chips used in artificial intelligence (AI). The company stated that its business selling DRAM chips, which are used in tech devices, returned to profit in Q3, following losses in the previous two quarters. Meanwhile, the NAND flash business, which has been suffering losses, is also showing signs of improvement.
SK Hynix’s third-quarter operating loss totaled 1.8 trillion won ($1.33 billion), compared to a profit of 1.7 trillion won the previous year. While the result slightly missed analysts’ estimates, the company’s revenue fell 18% year-on-year to 9.1 trillion won. Despite the downturn in the memory chip industry, there is solid demand for SK Hynix’s advanced DRAM chips, particularly those used in the growing field of generative AI.
SK Hynix has been ahead of its rivals in developing HBM3 chips and has secured Nvidia, a leader in AI chips, as a client. The company believes that the effects of memory chipmakers’ production cuts are starting to show as clients are placing new orders and chip prices are stabilizing. Analysts predict that SK Hynix will swing to a profit in the current quarter, as manufacturers of smartphones and PCs reduce their chip inventories and demand increases.
Overall, SK Hynix’s positive Q3 results indicate that the boom in AI will drive chip profits in the coming months. With a rebound in memory chip prices and an improving industry outlook, the company is optimistic about its future prospects. As the market for advanced chips used in AI continues to grow, SK Hynix is well-positioned to capitalize on this trend.
Readers, what are your thoughts on SK Hynix’s forecast for chip profits driven by the boom in AI? Do you believe that the demand for advanced chips will continue to increase? Share your opinions in the comments below!
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