Investment plan

SK Hynix cuts 2023 investment plan after third-quarter profit slump

By Kwanwoo Jun

 

SK Hynix Inc. plans to more than halve its capital expenditure next year after posting a sharp decline in third-quarter net profit due to weak demand and weak prices for semiconductors.

In response to weak demand and prices, the South Korean memory chipmaker has pledged to cut capital expenditure by more than 50% in 2023.

Net profit for the quarter ended September was 1.103 billion won ($772.8 million), down 67% from a year earlier, the company said Wednesday.

This missed a consensus forecast compiled by FactSet for a net profit of KRW 1.597 trillion.

During the quarter, revenue fell 7.0% year on year to KRW 10.983 trillion, while operating profit fell 60% year on year to KRW 1.656 trillion.

SK Hynix attributed the sharp decline in profits to the industry slowdown. He expects global chip supply to exceed demand at this time.

The company said it would reduce production of low-end or less profitable memory chips, while focusing on its growing business of DRAM chips for data servers.

Analysts say the semiconductor industry could recover next year thanks to a rebound in chip prices and tight supply.

 

Write to Kwanwoo Jun at [email protected]

 

(END) Dow Jones Newswire

October 25, 2022 8:24 p.m. ET (12:24 a.m. GMT)

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