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By Kim Hyun-bin
SK hynix expects to triple its sales of NAND memory chips over the next five years on the back of its recent acquisition of Intel's business.
"The company will secure self-sustainable business growth in the NAND sector within the next three years as well as increasing NAND revenue to triple that of before the acquisition in the next five years," SK hynix CEO Lee Seok-hee said during a conference call after releasing the company's third-quarter earnings, Wednesday. "Before we have been known as a leader in the DRAM market, but through the acquisition of Intel's NAND business we will be recognized as the top memory player in the market."
SK Hynix acquired Intel's business for $9 billion, which includes the U.S. chip giant's solid state drive (SSD) unit and a NAND chip plant in Dalian, China.
Last year, the company's saw 5.1 trillion won in sales of NAND semiconductors, or 19 percent of the company's 27 trillion won revenue.
Intel's non-volatile memory solution business generated $4.4 billion in 2019.
"SK acquired Intel's NAND flash business to better its position in the global market by diversifying its portfolio and securing leading technologies in the SSD sector," the CEO said. "Through the acquisition, the company is seeking to establish a balanced business structure between DRAM and NAND flash."
Lee is a former Intel employee, working for the U.S firm between 2000 and 2010. He emphasized that the industry is at a turning point with increasing demand for SSDs.
According to the company, the global data center storage sector is expected to grow from 0.9 billion terabytes (TB) to 5.1 billion TB in 2030 with SSDs rising from 10 percent this year to 43 percent over the period.
SK hynix recorded 1.07 trillion won in net profits for the third quarter, up 117.5 percent from a year earlier, according to a regulatory filing released Wednesday, as demand for mobile chips has soared during the COVID-19 pandemic.
Operating profit more than doubled to 1.29 trillion won from 472.6 billion won in the same period last year, while sales rose 18.9 percent year-on-year to 8.12 trillion won.
Industry watchers believe the surge in DRAM purchases was due to the U.S. ban on Huawei as the Chinese company purchased large sums of semiconductors ahead of the ban which went into effect Sept. 15.
DRAMs accounted for 74 percent of SK hynix's revenue for the third quarter, while NAND flash chips reached 24 percent.