(Adds details on the quarter, context and share price)
* Q4 operating profit 785 bln won vs 780 bln won forecast
* DRAM shipments down 13 q/q due to China plant fire
* Shares end down 1.8 pct prior to earnings announcement
SEOUL, Jan 28 South Korea's SK Hynix Inc
ended its two consecutive quarters of record high
earnings on Tuesday, as a rally in computer memory chip prices
have started to ease and production remained tight following a
fire at its plant in China.
The Apple Inc supplier is bracing for a tougher
year after posting record profits in 2013, as the PC industry
continues to shrink and growth in the booming mobile devices
Apple missed Wall Street's target for iPhone sales over the
crucial holiday shopping season and offered a
weaker-than-expected forecast for this quarter, underscoring
challenges smartphone makers are facing as a result of high-end
market saturation in many advanced economies.
The world's second-biggest memory chipmaker reported 785
billion won ($724 million) in October-December operating profit,
broadly in line with analysts' consensus forecast of 780 billion
expected by Thomson Reuters I/B/E/S.
The result compares with a 55 billion won profit a year ago
and a record 1.16 trillion won profit in the previous quarter.
Hynix is hoping a gradual recovery in production from the
damaged plant in Wuxi, which manufactured 15 percent of global
DRAM chips before the blaze in September, will help cushion the
impact of weakening chip prices and win back market share from
It competes with market leader Samsung Electronics Co Ltd
, Japan's Toshiba Corp and U.S.-based Micron
Hynix said shipments of dynamic random access memory (DRAM)
chips fell 13 percent in the fourth quarter from the previous
quarter due to reduced output from a China plant, outweighing a
1 percent increase in prices sparked by concerns over tight
supply, even as the PC market continued to shrink.
Worldwide PC shipments fell 10 percent last year after
declining seven consecutive quarters as manufacturers could not
stop consumers opting for smartphones and tablets instead,
according to researcher IDC.
Contract prices of DRAM chips, widely used in computers,
dropped 3 percent in the first half of January, according to
price tracker DRAMeXchange.com.
Shares of Hynix closed down 1.8 percent on Monday prior to
the earnings announcement, compared with a 1.6 percent decline
in the benchmark index. The stock has gained 8 percent
over the past three months, beating a 5 percent drop in the
(Reporting by Miyoung Kim; Editing by Bernard Orr)