SK hynix has resumed outsourcing DRAM packaging to WINPAC, ending a four-year break in a relationship that once supplied 61% of the OSAT provider's revenue. The products covered are DDR4 and DDR5 DRAM, handled through flip-chip packaging at WINPAC's P Campus, which has already begun mass production after completing equipment configuration, industry sources said on September 29.

The move expands both the volume and the number of partners in SK hynix's outsourced flip-chip packaging pool. A-PROTECH, another OSAT provider, took the first tranche of the work; WINPAC is the second partner to come on line.

WINPAC's P Campus in South Korea handles packaging for high-performance products including DRAM, NAND flash and eUFS (embedded Universal Flash Storage). The company recently raised monthly capacity at the site from 44 million units to 50 million units — a roughly 14% increase that positions it for the new volumes.

"SK hynix has improved its relationship with WINPAC and resumed packaging outsourcing with the company after four years," an industry source said. "Demand for outsourced packaging has increased significantly as conditions in the memory market have improved sharply. WINPAC's ability to secure working capital needed to operate equipment and maintain production processes through restructuring also appears to have played a major role."

The two companies share a long history. Founded in 2002, WINPAC grew on outsourced volumes from SK hynix, handling 144-ball grid array (BGA) packages, board-on-chip (BoC) packaging for DDR2 and DDR3 DRAM, multi-chip packages (MCP) and semiconductor testing. It began mass production of flip-chip packaging in 2019. Through the first half of 2021, SK hynix accounted for 61% of its total revenue.

The relationship broke down in 2022. WINPAC won its first outsourced order from Samsung Electronics that year, and as it prioritized the new customer it struggled to supply SK hynix. SK hynix cut volumes step by step, and the partnership ended in 2023 as the memory downturn deepened the damage.

The cost was severe. WINPAC's memory back-end utilization rate fell to 20–25%. Depreciation on high-priced equipment kept flowing through as fixed costs, producing annual losses of roughly 20 billion won. From 2023 through 2025 the company accumulated operating losses of more than 60 billion won.

"If losses continue, it becomes difficult to obtain bank loans or raise funds, and customers are also reluctant to assign large-scale mass-production volumes," another industry source said. "The company needs to resolve financial uncertainties and secure funds to operate mass-production lines before it can win new orders."

The mechanics of outsourcing explain why balance-sheet health matters so much. OSAT providers must invest in dedicated equipment, production-line construction and information-system integration tailored to each customer's product specifications before any wafer arrives — capital that must be committed in advance of revenue.

WINPAC spent the past two years rebuilding. Since last year it has sold unneeded equipment and other assets, cut fixed costs through voluntary resignations, and repaid more than 40 billion won in debt, reducing its financing and interest burden. The restructuring worked: the company turned to a monthly operating profit in March this year. Industry sources believe the SK hynix volumes followed directly from that recovery, and WINPAC now counts both of South Korea's memory giants — SK hynix and Samsung Electronics — as customers.

The commercial upside is substantial. WINPAC reported revenue of 75.547 billion won last year. Industry estimates put this year's annual revenue at more than 110 billion won, nearly 50% higher. If testing volumes and orders from overseas customers expand further, revenue could exceed 150 billion won, according to those same estimates — a figure that would roughly double last year's result.

For SK hynix, the expanded outsourcing pool reflects a memory market recovery strong enough to push back-end capacity beyond in-house limits, with DDR4 and DDR5 both still generating demand across the portfolio. Flip-chip packaging itself supports that demand: metal bumps tens of micrometers across connect the chip face-down to a substrate, shortening signal paths, cutting latency and data loss, and allowing more I/O pins in thinner packages than conventional wire bonding.

With WINPAC back in the supplier pool and capacity lifted to 50 million units per month, the competitive dynamic in Korea's OSAT sector has shifted — and further volume shifts toward external partners will depend on whether memory demand keeps outrunning SK hynix's in-house packaging capacity.