SK hynix Inc. said Wednesday it logged losses for the second consecutive quarter, as a worsening macroeconomic climate dented demand for semiconductors used in PCs and other digital products, and a continued chip glut wiped out profits.
The world’s second-largest memory chip maker said in a regulatory filing its operating losses amounted to 3.4 trillion won (US$2.5 billion) in the first quarter, compared with a profit of 2.86 trillion won a year ago.
Net losses came to 2.58 trillion won, turning from a profit of 1.98 trillion won a year earlier. Sales fell 58.1 percent to 5.08 trillion won.
“As the memory chip downturn continued through the first quarter, the company posted a sequential drop in revenues and widened operating losses on sluggish demand and falling product prices,” SK hynix said in a statement.
“But we expect revenues to rebound in the second quarter after bottoming out in the first, driven by a gradual increase in sales volume.”
The South Korean chipmaker swung to a deficit in the fourth quarter last year for the first time since the third quarter of 2012, as its customers halted new orders to reduce their excessive inventories amid slow consumer demand.
SK hynix makes most of its profits from selling memory chips. But the macroeconomic woes, including the ongoing war between Russia and Ukraine, inflation and rising interest rates, led consumers to tighten their spending on electronics that need such semiconductors.
Global PC shipments are estimated to have declined more than 30 percent from a year ago in the first quarter, while smartphone sales are believed to have fallen around 12 percent.
Source: Yonhap News Agency