The current business situation

As for DRAM, Hynix has provided a wide array of DRAM chips ranging from high-capacity, ultra-small to ultra-energy efficient ones. In 2009, it was ranked second with a global market share of 21.6 percent in a survey, conducted by iSuppli. Moreover, Hynix has acquired world-class technological capability - as exemplified by the development of 44-nano DDR3 DRAM and 44-nano 2-gigabit mobile DRAM.

As of the end of 2009, Hynix's DDR3 production accounted for 50 percent of its main memory DRAM production and is expected to reach 80 percent by year end. In addition, Hynix has raised its profitability by significantly ramping up the share of its high value-added DRAM chips for mobile phones, graphics and servers. And Hynix has set up sustainable product portfolios aimed at minimizing the effects of market vagaries.

Since Hynix's NAND flash memory made its market debut in 2004, Hynix has consistently made efforts in product development and launched aggressive marketing strategies, thereby ascending into the ranks of NAND flash market leaders. In 2009, Hynix was ranked third with a 9.9 percent NAND flash market share in a survey by iSuppli.

In February of 2010, the development of 26 nano 64-gigabit NAND flash, which is scheduled to go into mass production in the third quarter of this year, helped Hynix significantly narrow the gap with the world's leading NAND flash supplier. This year, Hynix is set to increase the share of 32-nano chips - whose production was begun at the end of 2009- with the goal of making a swift transition to 32-nano chips and boosting cost competitiveness.

Strategies and competitive edges

Hynix's strategy is to secure profitability by maintaining its technological leadership through constant investment in R&D

Hynix has gone into overdrive to provide products - armed with cost competitiveness right from the R&D phase- in a timely manner. R&D spending as a percentage of sales has been on the rise, standing at five percent in 2006, six percent in 2007, and 10 percent in 2008. Hynix believes that growing R&D spending will come to fruition in the long run. In 2009, although the semiconductor industry reeled from the global economic recession, Hynix made R&D investments similar to pre-crisis levels.

In addition, Hynix's continued effort resulted in its R&D talent making up 20 percent of the total workforce at the end of 2009. Such growing R&D spending has helped Hynix continue its good track record of developing the world's first-ever memory semiconductors.

The competitiveness of Hynix and the world's first-ever products

The world's No.2 DRAM maker and No. 3 NAND flash supplier in terms of sales

At the moment, while foreign competitors are keen on producing 60 or 70-nano class chips, Korean semiconductor suppliers including Hynix have been churning out 40-nano class chips, leaving foreign rivals lagging far behind. Hynix reckons that its technology will further shake off its rivals in the years to come.

The swift transition to DDR3 DRAM is likely to give Hynix another competitive edge since a few leading companies are able to supply DDR3 DRAM. More non-PC DRAM chips for mobile phones and graphics will be added to Hynix's product portfolio; a wide range of high-performance chips will be developed to improve Hynix's revenue structure. As corporate companies have shown high levels of satisfaction with Hynix's high value-added products, the prospect for these products seems quite bright.

As for NAND flash, Hynix has climbed up to third place in market share, just three years after it entered the NAND market in 2004. Hynix came out with its 32-nano 32-gigabit NAND flash memory in August, 2009, and 26-nano 64-gigabit NAND memory just six months later. Hynix has already obtained top-notch technologies for NAND flash memory chips.

Hynix Semiconductor Inc.

Hynix Semiconductor Inc., formerly known as Hyundai Electronics, was established in 1983, absorbed LG Semiconductor in 1999 and changed its name "Hyundai Electronics" to Hynix Semiconductor Inc. in 2001. Hynix Semiconductor - the world's second largest- purveyor of dynamic random access memory (DRAM) chips and NAND flash memory chips- ventured into CMOS Image Sensors (CIS) business again in 2007 in a bid to expand its business realm.

Hynix Semiconductor boasts its well-built global network: it has its production lines in Seoul, Icheon and Cheongju in South Korea and Wuxi and Jiangsu Province in China, with 26 sales arms and branches around the world. In particular, it has secured large market shares in emerging markets, such as China, India, and Russia, and has been exporting more than 97 percent of its total production to 35 nations- including the U.S. and the EU.

Hynix is ranked seventh in the global semiconductor market in 2009 and has maintained its position as the world's second largest memory chipmaker. Hynix looks to lead the global semiconductor market by having the world's best technology and cost competitiveness under its belt through continued investment in R&D.

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