UPDATE 1-SK Hynix Q4 misses forecast, weak PC chip prices weigh

Tue Jan 29, 2013 6:40pm EST

* Q4 operating profit 55 bln won vs 123 bln won fcast

* Q1 profit seen rebounding on PC chip demand-analysts

* Weaker orders from Apple seen capping earnings upside

By Miyoung Kim

SEOUL, Jan 30 (Reuters) - South Korean chipmaker SK Hynix Inc returned to a quarterly profit on Wednesday on demand from mobile device makers such as Apple Inc, but it fell far short of forecasts on weak sales of computer chips and a strong won.

Hynix's earnings prospects have brightened this year after prices of computer memory chips jumped 30 percent from December, as PC makers prepare for China's lunar new year holiday sales and as supply tightens, with chip makers curtailing computer chip output in favour of more chips for mobile devices.

But that outlook is now less upbeat than it once was as many analysts now believe Apple will cut its orders due to weak demand for iPhones, while the South Korean currency has also gained, which reduces the value of earnings made abroad when they are repatriated.

Hynix, which competes with bigger rival Samsung Electronics , Japan's Toshiba Corp and U.S.-based Micron Technology, reported 55 billion won ($50 million) in October-December operating profit, versus a 106 billion won loss a year earlier.

The result, which comes after a small loss in the previous quarter, missed an average forecast of 123 billion won profit from 23 analysts polled by Thomson Reuters I/B/E/S.

It was also below a 93 billion won profit forecast by Thomson Reuters StarMine's SmartEstimate, which places more emphasis on timely projections from the most accurate analysts. Recent strength in the South Korean currency and disappointing sales of Apple's iPhone during the year-end holiday season were behind the lower forecasts in the SmartEstimate.

Shares in Hynix have risen 20 percent over the past six months but the stock lost 10 percent since Jan. 14 on fears that Apple will cut orders.

Apple became Hynix's largest customer last year and generates around 30 percent of the South Korean firm's revenue, according to analysts. The Cupertino California-based firm has widened its supplier base and moved away from its key supplier and rival Samsung.

Fears that demand for the iPhone and the iPad could be slowing were triggered by news of possible production cutbacks by some component suppliers in Asia, and then were exacerbated after Apple reported weaker-than-expected iPhone sales in its quarterly earnings last week.