SK Hynix to focus on expanding 8-inch foundry business
Company to spend more on equipment this year
SK Hynix said on Wednesday that it will focus its foundry, or contract chip production, into 8-inch wafers.
The company also said it will expend spending that was planned for 2022 to the second half of 2021 to secure fab equipment due to extended lead time for them amid the global chip shortage.
The South Korean chip giant said at its conference call for the first quarter that it was reviewing business plans for its existing 8-inch foundry. It has no plan to expand into 12-inch foundry, however.
SK Hynix vice chairman Park Jung-ho had earlier told reports that the company plans to expand investment into foundry.
The chip firm said it plans to move its 8-inch foundry business run by its wholly owned subsidiary SK Hynix System IC to China to lower cost. The company said it was an investor of Key Foundry, previous the foundry business of Magnachip.
On deciding to spend more on fab equipment this year, SK Hynix CFO Roh Jong-won said lead time and setup period for them has increased due to more semiconductor companies increasing spending. The company was expending some of its spending on equipment earlier than planned.
The increase in production output from the earlier-than-expected spending will start in 2022, Roh said.
SK Hynix also said it plans to manufacture Gen 4 1a-nanometer (nm) DRAM using the extreme ultraviolet (EUV) process this year. It has applied the process to one layer of the 1a-nm DRAM. The company will expand EUV to 1b- and 1c-nm DRAMs later, it said.
SK Hynix said it has formed a partnership with ASML to receive EUV equipment stably for the next few years. It has also formed a dedicated team for EUV so that it can applied to the production process without any problems.
The South Korean company is forecasting that demand for DRAM and NAND falsh will increase 20% and mid-30%, respectively, this year.
SK Hynix recorded 8.49 trillion won in sales and 1.32 trillion won in operating income in the first quarter, an increase of 18% and 66%, respectively, year-on-year.