SK Hynix Posts Near 30 Percent Drop in Q2 Net Profit

South Korea's SK Hynix said Thursday its second-quarter net profit tumbled nearly 30 percent from a year ago on falling memory chip prices.

Net profit for the world's second-largest chipmaker amounted to KRW 674 billion ($658 million) for April to June, down 29 percent from a year ago.

Operating profit inched down three percent to KRW 1.08 trillion during the same period, the Icheon-based company said in a statement.

Sales remained nearly unchanged at KRW 3.92 trillion.

Hynix said the average selling price of its dynamic random access memory (DRAM) chips, mostly used for computers, fell five percent in the second quarter.

The average price of its NAND flash chips -- used for mobile devices -- also dropped 19 percent although production increased 54 percent.

(Also see: Toshiba sues South Korean rival SK Hynix for corporate spying)

Global demand for memory chips is expected to grow later this year in emerging markets including China, it said.

Chipmakers are also expected to keep production minimal to ward off a glut that hurt their businesses earlier this year, a combination that will help boost prices later, the company said.

China's new market for ultrafast 4G wireless service, commonly called long-term evolution (LTE), is expected to grow rapidly with sales of LTE-enabled handsets to reach 100 million units this year, SK Hynix President Kim Joon-Ho said.

"We earlier estimated sales of LTE devices in China to reach 10 million in the first quarter of this year, only to see them reach three million," Kim said.

"But the country has been building more LTE-related infrastructure in the second quarter, which will improve our (sales) prospects," he said.