SK hynix employees get hefty bonus on soaring profits

By Jun Ji-hye

SK hynix has decided to pay its employees 1,700 percent of their monthly base wage as a special bonus to share the firm's best-ever performance in 2018, company officials said Thursday.

The company suggested a 1,700 percent cash bonus during wage bargaining with a union the previous day, and the union accepted this.

If the base salary of an employee is 3 million won ($2,700) per month, they will receive 51 million won as a bonus this time.

The highest-ever bonus will be awarded this month or early next month.

The generous rewards come as the memory chip maker's annual sales and operating profit in 2018 reached 40.4 trillion won and 20.8 trillion won, respectively, breaking the previous record for the second consecutive year, according to the firm's earnings report issued Thursday.

The firm said chipmakers enjoyed a semiconductor super cycle last year amid growing demand from data centers and high performance mobile devices.

In the so-called emerging data economy, Google, Amazon and other global IT companies became the main buyers of semiconductors to increase their servers to handle big data and cloud business.

SK hynix, however, posted disappointing results for the fourth quarter, with its sales and operating profit during the period standing at 9.9 trillion won and 4.4 trillion won, down by 13 percent and 32 percent from the previous quarter, respectively.

The company said the memory chip market has changed rapidly in the wake of slowing demand and falling global sales prices.

A crisis has been looming in the market as trade conflicts between the United States and China raised uncertainty in the global economy, which led global IT companies to put their investments on hold.

“Shipment of DRAM during the October-December period decreased by 2 percent from the previous quarter, while average sales price fell by 11 percent,” said an official from SK hynix. “Shipments of NAND flash memory chips increased by 10 percent, but the average sales price fell by 21 percent.”

DRAMs are crucial parts of computers, while NAND flash chips are used for mobile devices such as a smartphone.

SK hynix forecast that the memory chip market will continue to suffer slowdown of demand and other uncertainties for the time being, but is expected to bounce back in the latter half of the year.

“We plan to focus on higher value-added products and cutting-edge technology in a bid to better respond to rapidly changing market situations,” the company official said.