Communication Event with Employees Held in Cheongju on the 10th Afternoon
"The Key to Maintaining Top Position Is Technology"
"CIS Business Transition Needed to Focus AI Capabilities"
Apology for Bonus Dispute: "Failed to Present Objective Indicators"
Kwack No-jeong, CEO of SK Hynix, said on the 10th, "The trend of artificial intelligence (AI) will continue in the future, and we will not neglect securing AI capabilities."
On the same day, at the 'Together THE Communication Event' held at SK Hynix Cheongju Campus, Kwack told employees, "The most important thing to maintain the number one position in the AI trend is technology," adding, "The recent transition of the CMOS image sensor (CIS) business was a decision made because it was necessary to concentrate capabilities in the AI field." SK Hynix announced on the 6th that it plans to integrate the CIS business division, which had been unprofitable, into the AI memory sector to focus its capabilities.
SK Hynix holds communication events every quarter where the CEO directly listens to employees and explains various management issues. This communication event was broadcast live to all domestic SK Hynix business sites.
At the event, executives including CEO Kwack, Kim Ju-seon, President of AI Infrastructure, Song Hyun-jong, President of the Corporate Center, Ahn Hyun, President of Development, Vice President Cha Seon-yong, Head of the Future Technology Research Institute, and Vice President Kim Young-sik, Head of Yangsan Operations, took the stage.
Kwack said, "If AI had not come, we would not have transitioned the CIS business, but since AI is a great opportunity, we made this decision," adding, "We will give CIS members enough time to find new job positions without rushing."
He also revealed countermeasures against fierce pursuit by Chinese companies. Recently, Chinese memory companies such as Changxin Memory Technologies (CXMT), Fujian Jinhua Integrated Circuit Co. (JHICC), and Yangtze Memory Technologies Co. (YMTC) have been threatening the industry by launching aggressive low-price volume offensives.
Kwack said, "Last year, there was an 'Operation Improvement' (OI) effect through efficiency improvements in CAPEX (capital expenditure) and OPEX (operating expenses)," adding, "We will continue to upgrade the OI management system." He continued, "From a technology perspective, we will expand mass production of HBM3E 12-stack and HBM4 this year, and maintain leadership in 1c and 1d (10nm-class DRAM)," adding, "We will also respond well to the conditions to ride the AI boom in NAND."
Finally, Kwack apologized for the recent dissatisfaction among employees regarding the payment of performance bonuses. Earlier this year, the company achieved record-high results (operating profit of 23.4673 trillion KRW) and paid a profit-sharing bonus (PS) of 1500% of the base salary, but there was conflict due to the union's claim that a higher level of special performance bonus should be paid.
Kwack said, "I apologize for the lack of communication regarding PS recently and the discomfort it caused employees," adding, "The company's fault was not presenting objective indicators clearly to avoid confusion." He continued, "Since 2021, we have introduced a more intuitive standard based on operating profit for performance bonus payments, but the part about negotiating PS exceeding 1000% was ambiguous," adding, "Now it is necessary to clarify this, and comprehensive consideration will be needed."
Previously, SK Hynix labor and management agreed in February 2021 to abolish Economic Value Added (EVA) and link PS to operating profit, which has higher predictability. Meanwhile, SK Hynix labor and management are expected to discuss wage increases and negotiations on PS excess through formal procedures related to wage negotiations scheduled for April.
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