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SEOUL: South Korea's SK Hynix<\/a> , the world's No.2 memory chip<\/a> maker, on Thursday warned of uncertainty in the second half of 2020 after its second-quarter operating profit tripled, beating analysts' forecasts thanks to higher chip prices.
SK Hynix said the COVID-19 pandemic and global trade disputes clouded the second-half outlook, but forecast improving demand for chips used in 5G smartphones and game consoles as major markets reopen.
\"The second-quarter was too good. Customers bought up as much inventory as possible as they weren't sure what component prices would be like because of COVID-19,\" said Kim Yang-jae, analyst at KTB Investment.
Memory chip prices rose in April-June due to increased server and notebook demand from people staying at home as well as customers stockpiling chips, some analysts said.
But server DRAM prices could fall in the second half as customers had brought forward orders to meet demand for online services, said analyst Park Sung-soon at Cape Investment & Securities.
SK Hynix said operating profit in the April-June period rose to 1.9 trillion won ($1.6 billion) from 638 billion won a year earlier, its highest quarterly profit since the fourth quarter of 2018.
Analysts expected a 1.7 trillion won profit for the company that counts Apple<\/a> Inc and Huawei<\/a> Technologies among its customers, according to Refinitiv SmartEstimate that is weighted towards more consistently accurate analysts.
Second-quarter revenue rose 33% to 8.6 trillion won.
Hynix's bigger rival Samsung Electronics<\/a> Co Ltd flagged a 23% rise in second-quarter operating profit earlier this month, while smaller peer Micron forecast current-quarter revenue would beat Wall Street estimates, thanks to solid chip sales.
SK Hynix shares were flat in the wider market that was down 0.4% in morning trade on Thursday.
($1 = 1,196.8500 won) (Reporting by Joyce Lee and Hyunjoo Jin; Editing by Muralikumar Anantharaman and Stephen Coates)
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