Source: Content compiled from ZDNET

According to Korean media reports, SK Hynix will continue its business by reorganizing the CMOS image sensor (CIS) development organization under the Future Technology Research Institute.

The industry said on the 5th that SK Hynix made this decision through restructuring in 2025. Cha Yong-yong, the president of SK Hynix Future Technology Research Institute (CTO, Chief Technology Officer), will also be in charge of CIS development.

So far, SK Hynix has been struggling in the low-profit CIS business. In the past few years, as the smartphone market, which is the source of demand, has shrunk and CIS demand has decreased, SK Hynix has had difficulty standing out due to the gap in market share with competitors.

According to market research firm Yole Development, last year's CIS market share was first Sony (45%), second Samsung Electronics (19%) and third Omnivision (11%), followed by sixth SK Hynix (4%).

As a result, many developers responsible for CIS at SK Hynix this year have been reassigned to other businesses, including the core business HBM (high bandwidth memory). In addition, CIS production capacity has been reduced by more than half compared to last year. There was a possibility in the industry that SK Hynix would close its CIS business in order to select and concentrate.

However, SK Hynix did not give up the CIS business and decided to continue. Based on HBM's past experience of operating unprofitably but continuing to operate and achieve results in the AI semiconductor market, CIS also expects demand to emerge not only in the smartphone field, but also in the automotive, machine vision, industrial and other fields. Market.

In particular, it is well known that SK Hynix CEO No-Jeong Kwak has a strong intention for the CIS business.

Earlier, President Kwak said at the regular shareholders' meeting in March last year, "I have no intention of closing the CIS business" and "there are some weaknesses and strengths compared to competitors, and we are analyzing these aspects." Details. ”

In 2008, SK Hynix acquired CIS developer Silicon File and entered the image sensor market. In 2019, the company opened a CIS R&D center in Japan and launched the image sensor brand "Black Pearl" in the same year, showing its willingness to expand its business. SK Hynix has successfully supplied CIS for low- and mid-priced smartphones in China and Samsung Electronics' 2021 foldable phone Galaxy Z3 series and Galaxy A series.

Previous report: SK Hynix

Reduces CIS business and shifts focus to HBM

According to a report by ZDNET Korea in October, SK Hynix has scaled back its less profitable CMOS image sensor (CIS) and foundry businesses while strengthening its strategy to focus on high-profit high-bandwidth memory (HBM) and AI memory.

Citing industry sources, ZDNET Korea said that SK Hynix has reduced its R&D investment in CIS, and its production capacity has been reduced by more than half from last year, with monthly 12-inch wafer production expected to drop to less than 7,000 wafers. In addition, employees in the system-on-chip (SoC) design department, which was previously responsible for designing memory controllers, will be reassigned to the HBM department.

The report also mentioned that SK Hynix has increased its SoC designers this year, directing them to projects aimed at developing next-generation memory solutions with computing power.

SK Hynix's strategy is to scale back certain business areas and focus resources on the more profitable HBM. The company is also focusing on future growth areas such as Compute Express Link (CXL), memory processing (PIM), and AI solid-state drives (AI SSD).

The report quoted semiconductor industry experts as saying that after establishing an HBM production line, it only takes three months to achieve a return on investment (ROI). For companies, investing heavily in HBM, which is in high demand and highly profitable, is a logical decision.

TrendForce pointed out that the average selling price of HBM is several times higher than that of traditional DRAM, and the price difference with DDR5 is about five times. Although general DRAM and NAND contract prices are expected to fall in the fourth quarter, HBM prices are expected to rise by 8% to 13%.

In fact, the news of reducing CIS R&D and production capacity is not new. At the beginning of this year, there were media reports that SK Hynix planned to reduce CIS production and shift its focus to HBM business due to falling demand.

In addition, SK Hynix has also reduced its foundry business. According to a report by the Korea Economic Daily in May, the board of directors of SK Hynix System Integrated Circuit (Wuxi), a foundry subsidiary of SK Hynix, decided to sell 21.3% of its shares in the Wuxi plant to Wuxi Industrial Development Group for approximately US$349.3 million.

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