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SK Hynix profits slash by half in 4Q

SK Hynix profits slash by half in 4Q

SEOUL: South Korean semiconductor giant SK Hynix’s profits have slashed by half in fourth quarter.

The company’s profits decreased mainly due t slowing global demand for personal computers and smartphones, it said Tuesday.

Global PC sales last year hit an eight-year low and sales of high-end smartphones slowed as gadget makers increasingly shifted focus to fast-growing mid- or low-end markets.

As demand for PCs as well as the handsets powered by expensive chips declined, average prices of SK Hynix’s dynamic random access memory (DRAM) – commonly used for PCs – and NAND flash chips used for mobile devices fell 10 and 15 percent respectively in the fourth quarter.

Net profit for the September to December period amounted to 871 billion won ($725 million), down 46 percent from a year ago, the company said in a statement. Operating profit also dropped 41 percent to 989 billion won during the same period, missing a 1.04 trillion-won average of analyst estimates compiled by Bloomberg News.

SK Hynix vowed to beef up investment and cut costs to overcome “crisis situations” expected this year including sluggish demand and escalating competition among chipmakers like local rival Samsung.