SK Hynix Records Unprecedented Profits as AI Memory Chip Demand Outstrips Supply Through 2025

Nvidia supplier SK Hynix has already sold next year's chips on AI boom

SK Hynix said it has already sold next year's production of semiconductors as the leading supplier of advanced memory chips to Nvidia posted record profits on the back of an artificial intelligence boom. Operating profit in the third quarter jumped 62 per cent year on year to a record Won11.4tn ($8bn), in line with analyst forecasts compiled by LSEG SmartEstimate. Revenue rose 39 per cent to Won22.4tn, driven by surging demand for memory chips used in AI data centres, the company said on Wednesday. The South Korean chipmaker said it expected its inventory for conventional dynamic random-access memory chips, which enable short-term data storage when a device is being used, was "extremely tight". It added that cutting-edge high-bandwidth memory (HBM) chips to continue to outstrip supply as use of AI applications broadens. "With the innovation of AI technology, the memory market has shifted to a new paradigm and demand has begun to spread to all product areas," said chief financial officer Kim Woo-hyun. Optimism for SK Hynix's business outlook intensified after the company, along with rival Samsung Electronics, signed a preliminary agreement with OpenAI this month to supply semiconductors for the ChatGPT maker's $500bn Stargate data centre project. SK Hynix said its estimate for demand from the project was more than double the industry's current HBM capacity and that it would set up a production system to meet OpenAI's demand. The chipmaker said it had completed HBM supply negotiations with other key customers for next year and would "substantially increase" capital expenditure as a result. It will begin supplying its most advanced HBM4 chips in the fourth quarter of this year. "HBM demand continues to increase rapidly, so it will be difficult for supply to meet demand any time soon," said Kim Ki-tae, head of HBM sales and marketing. SK Hynix makes up more than half of the global HBM market, while Samsung accounts for just over a quarter, with US-based Micron, the other leading company in the sector, according to consultancy TrendForce. The company's competitive edge in HBM has helped triple its share price this year, making SK Hynix one of South Korea's best-performing stocks. Its shares rose 4 per cent on Wednesday. SK Hynix said the AI market's shift to inference -- the process by which applications such as chatbots produce responses -- had increased demand for high-performance AI server chips. "We project AI inference memory demand to expand not only in the US but also in China as Chinese hyperscalers are expected to push for AI inference investment," Citi analysts said in a recent report. Samsung is expected to post its biggest quarterly profit in three years when it reports on Thursday. "With AI as the major driver, we're expecting the HBM market to continue growing steeply over the next few years to around $43bn by 2027, giving strong earnings leverage to memory manufacturers like SK," said MS Hwang, research director at Counterpoint Research.

Nvidia-supplier SK Hynix third-quarter profit jumps 62% to a record high on AI-fueled memory demand

A man walks past a logo of SK Hynix at the lobby of the company's Bundang office in Seongnam on January 29, 2021. South Korea's SK Hynix, one of the world's largest memory chipmakers, on Wednesday posted record quarterly revenue and profit, boosted by a strong demand for its high bandwidth memory used in generative AI chipsets. Here are SK Hynix's third-quarter results versus LSEG SmartEstimates, which are weighted toward forecasts from analysts who are more consistently accurate: Revenue rose about 39% in the September quarter compared with the same period a year earlier, while operating profit surged 62%, year on year. SK Hynix makes memory chips that are used to store data and can be found in everything from servers to consumer devices such as smartphones and laptops. "As demand across the memory segment has soared due to customers' expanding investments in AI infrastructure, SK Hynix once again surpassed the record-high performance of the previous quarter due to increased sales of high value-added products," SK Hynix said in its earnings release. The company has benefited from a boom in artificial intelligence as a key supplier of high-bandwidth memory or HBM chips used to power AI data center servers. HBM falls into the broader category of dynamic random access memory, or DRAM -- a type of semiconductor memory used to store data and program code that can be found in PCs, workstations and servers. SK Hynix has set itself apart in the DRAM market by getting an early lead in HBM and establishing itself as the main HBM supplier to the world's leading AI processor maker, Nvidia. However, its main competitors, U.S.-based Micron and South Korean-based tech giant Samsung, have been working to catch up in the space.

SK Hynix sells out DRAM, NAND, and HBM capacity into 2026 amid AI frenzy

Serving tech enthusiasts for over 25 years. TechSpot means tech analysis and advice you can trust. What just happened? SK Hynix says it has already sold out next year's supply of its key semiconductor products, driven by intense demand for high-performance memory chips for artificial intelligence systems. The company's third-quarter results show the industry's rapid transformation under the weight of AI investment, with profits reaching record levels and production schedules booked well into 2026. The South Korean chipmaker reported an operating profit of 11.4 trillion won ($8 billion) for the three months ended September 30, a 62 percent increase from the same period last year. Revenue rose 39 percent year over year to 22.4 trillion won, fueled by strong orders for its high-bandwidth memory chips, or HBM. Executives say demand for SK Hynix's latest memory technology continues to outstrip supply. Kim Kyu-hyun, head of DRAM marketing, described the markets for both DRAM and NAND memory as "extremely tight," noting that customers have already secured production slots for conventional memory chips extending into 2026. "Our DRAM, NAND, as well as HBM capacity for next year has been sold out," he told The Financial Times. The imbalance between supply and demand is most pronounced in the HBM segment. Research firm TrendForce notes that SK Hynix controls more than half of the global HBM market and produces chips used in many of Nvidia's AI accelerators. Rival Samsung Electronics holds just over a quarter of the market, while Micron Technology in the United States captures much of the remainder. Strong AI-driven demand has also reshaped strategic partnerships. Earlier this month, SK Hynix and Samsung each signed preliminary agreements with OpenAI to supply semiconductors for the company's proposed $500 billion "Stargate" supercomputing data center project. SK Hynix said anticipated demand from that initiative alone would more than double the industry's existing HBM capacity. The company plans to increase capital spending substantially to meet those projections and confirmed that it recently completed negotiations on HBM supply contracts with all major customers for 2025. The company expects to begin volume production of its next-generation HBM4 chips in the fourth quarter of 2025. Kim Ki-tae, head of HBM sales and marketing, said the chip's rollout will represent a considerable leap in data-processing efficiency but cautioned that meeting market needs will remain challenging in the near term. "HBM demand continues to increase rapidly, so it will be difficult for supply to catch up any time soon," he said. Industry experts say the company's prospects will remain closely tied to the broader trajectory of AI infrastructure. Citi analysts noted that AI inference has sharply increased demand for high-performance server memory not only in the United States but also in China, where hyperscale cloud companies are accelerating similar investments. Counterpoint Research projects the global HBM market will reach roughly $43 billion by 2027, with both SK Hynix and Samsung benefiting from the growing demand.

Nvidia-supplier SK Hynix bets on chip 'super cycle' after booking record profit - The Economic Times

South Korea's SK Hynix has sold out all its chip production for next year and plans to sharply boost investments, expecting an extended chip "super cycle" spurred by the AI boom, it said on Wednesday after reporting a record quarterly profit. The company, which supplies artificial intelligence chip leader Nvidia, said supply growth for memory chips is likely to be limited just as demand is surging, with customers vying to expand investments in AI data centre infrastructure. SK Hynix shares rose as much as 6% after the record profit, outpacing a 1.5% rise in the benchmark KOSPI. A growing number of customers are scrambling to lock in supplies in response to a chip shortage, placing orders for next year in advance and pushing for long-term contracts, the company said. At the same time, a shift in production to high-bandwidth memory (HBM) has strained output of conventional memory, such as DRAM, and "total output will inevitably remain limited," said Kim Kyu-hyun, SK Hynix's head of DRAM marketing. "This structural constraint on DRAM supply is expected to support the current prolonged memory supercycle, as supply growth lags behind accelerating demand," he said. SK Hynix reported an 11.4 trillion won ($8.02 billion) operating profit for the July-September period, up 62% from a year earlier and in line with a forecast by LSEG SmartEstimate. Quarterly revenue rose 39% in the third quarter to 24.4 trillion won. DEMAND GROWTH OUTSTRIPS SUPPLY SK Hynix has already secured full customer demand for its entire DRAM and NAND production for next year and plans to start shipping the next-generation HBM4 chips in the fourth quarter of this year. The chip maker expects DRAM shipments to grow by more than 20% year-on-year in 2026. "DRAM inventories have dropped to extremely low levels, and for DDR5 products, newly produced chips must be shipped to customers immediately to meet demand," said Kim. While thriving on a strong market for conventional memory, the company wants to maintain its edge in advanced AI chips supplied to Nvidia, in the face of mounting competition from rivals such as Samsung Electronics and Micron . SK Hynix said it had completed discussions with key customers regarding HBM supply for 2026, and plans a full-scale sales expansion of HBM4 products next year. As confidence grows in the earnings potential of the AI market, global AI companies are ramping up their investment spending, Kim said, driving rapid growth in demand for a wide range of memory products including HBM, DDR5, and enterprise SSDs. To meet this demand, a rise in capital expenditure across the memory industry is inevitable, and SK Hynix said it expects its own spending to grow substantially from this year's level, without specifying a figure. Buoyed by its advantage in advanced chips, SK Hynix's shares have surged 200% so far this year, outpacing an 87% gain in Samsung's shares and a 67% gain in the benchmark KOSPI. ($1 = 1,421.4800 won) (Reporting by Heekyong Yang, Hyunjoo Jin and Joyce Lee; Editing by Jamie Freed and Sonali Paul)

Nvidia Effect: Key Suppliers Have Already Sold Out AI Memory Chips For 2025 - Alphabet (NASDAQ:GOOGL), Apple (NASDAQ:AAPL)

Nvidia Corp's (NASDAQ:NVDA) insatiable demand for advanced artificial intelligence memory chips has sparked a boom for South Korea's chip giants -- propelling SK Hynix to record profits and pushing Samsung Electronics Co, Ltd (OTC:SSNLF) to sell out its next-generation high-bandwidth memory (HBM) supply for 2025. Fueled by Nvidia's AI momentum, SK Hynix and Samsung are racing to expand high-bandwidth memory production. Nvidia's surging demand for advanced memory chips helped propel SK Hynix to record profits, as the South Korean chipmaker sold out its entire semiconductor production for next year. Also Read: Nvidia Becomes The $4.5 Trillion Giant Driving AI's Biggest Deals As the primary supplier of Nvidia, SK Hynix reported a 62% year-over-year jump in third-quarter operating profit to a record ₩11.4 trillion ($8 billion). Revenue climbed 39% to ₩22.4 trillion, fueled by booming demand from AI data centers. SK Hynix's capacity for DRAM, NAND, and HBM chips is fully booked through next year, with customers even preordering conventional memory for 2026, the Financial Times reported on Thursday. The optimism follows SK Hynix's preliminary deal with OpenAI alongside Samsung to supply semiconductors for the ChatGPT maker's massive $500 billion Stargate data center project. SK Hynix estimated that the project's memory demand exceeds twice the current global HBM capacity and plans to expand production accordingly. After finalizing HBM supply contracts with key clients for next year, SK Hynix said it will significantly ramp up capital spending and begin shipping its most advanced HBM4 chips in the fourth quarter. Executives expect supply to remain tight amid accelerating AI investment in the U.S. and China. SK Hynix currently controls more than half of the global HBM market, far ahead of Samsung and U.S.-based Micron. Its dominance in high-performance AI memory has tripled its share price this year. Nvidia's growing demand for high-performance AI memory has fueled a major breakthrough for Samsung, which confirmed that it began shipping its latest HBM3E chips to Nvidia in the third quarter and has already sold out next year's supply of next-generation HBM4 chips. Samsung said its HBM3E chips are now in full-scale mass production and available to all key customers, the Korea Economic Daily reported on Thursday. After successfully passing Nvidia's qualification tests for its 12-layer HBM3E chip earlier this year, the company began shipping the product to power Nvidia's AI accelerators. It also sent samples of its upcoming HBM4 chips to clients for testing, with preorders for 2025 already exceeding planned production levels. Vice President Kim Jae-june said Samsung significantly expanded HBM capacity for 2025 but still faces stronger-than-expected demand. The company is considering additional investment to meet orders as it prepares for large-scale HBM4 production in 2026. Driven by the AI boom, Samsung's memory division posted record-high quarterly revenue of ₩26.7 trillion ($19 billion) in the third quarter, boosted by strong sales of HBM, DDR5, GDDR7, and server solid-state drives. The results lifted overall semiconductor profit to ₩7 trillion. Beyond memory, Samsung's system-on-chip and foundry businesses also strengthened, aided by new contracts with Apple Inc. (NASDAQ:AAPL) for U.S.-based chip manufacturing and Tesla Inc. (NASDAQ:TSLA) for AI processor production. The company expects AI-driven demand to continue accelerating, with plans to expand 1c DRAM and server memory production while ramping up its 2-nanometer foundry operations in Taylor, Texas, next year. Meanwhile, Nvidia became the first $5 trillion market cap company with the Big Tech quarterly results, including Meta Platforms (NASDAQ:META), Alphabet Inc (NASDAQ:GOOGL), posing catalysts for the company with their resilient AI spending. NVDA Price Action: Nvidia shares were down 1.99% at $202.91 at the time of publication on Thursday. The stock is approaching its 52-week high of $212.18, according to Benzinga Pro data. Read Next: The 'Big 3' Tech Playbook: Why Apple, Amazon And Microsoft Keep Winning Image via Shutterstock AAPLApple Inc$271.020.49%OverviewGOOGLAlphabet Inc$281.832.64%METAMeta Platforms Inc$661.15-12.0%NVDANVIDIA Corp$201.56-2.65%SSNLFSamsung Electronics Co Ltd$42.480.34%TSLATesla Inc$451.40-2.19%Market News and Data brought to you by Benzinga APIs

Nvidia-Supplier SK Hynix Sells Out 2026 Chip Supply As AI Boom Triggers Historic 'Super Cycle' -- Posts Record $8.02 Billion Q3 Profit - Microsoft (NASDAQ:MSFT), NVIDIA (NASDAQ:NVDA)

On Wednesday, South Korea's SK Hynix (HXSCF) said it has completely sold out its chip supply for next year and plans to ramp up investments as the global artificial intelligence boom fuels a memory chip "super cycle." AI Demand Sparks Record-Breaking Quarter The world's second-largest memory chipmaker and a key supplier to Nvidia Corporation (NASDAQ:NVDA) reported a record KRW 11.4 trillion ($8.02 billion) operating profit for the July-September quarter, up 62% from a year earlier. Quarterly revenue climbed 39% to KRW 24.4 trillion, driven by soaring demand for high-bandwidth memory and AI data center chips. After reporting its profit, Kim Kyu-hyun, SK Hynix's head of DRAM marketing, stated that the industry's shift toward HBM production has strained overall chip output, reported Reuters. "Total output will inevitably remain limited," he said. "This structural constraint on DRAM supply is expected to support the current prolonged memory super cycle, as supply growth lags behind accelerating demand." See Also: Trump in Talks To Appear On CBS' 60 Minutes Just Months After Securing Eye-Watering $16 Million Settlement: Report HBM4 Launch And OpenAI Partnership SK Hynix said it will begin shipping its next-generation HBM4 chips in the fourth quarter, building on its leadership in AI memory. The company has already secured full customer demand for its entire DRAM, HBM and NAND production for 2026, the report said. It also mentioned a letter of intent with ChatGPT-maker OpenAI for HBM supply, underscoring robust AI-driven demand. SK Hynix expects the HBM market to grow more than 30% annually over the next five years as tech giants expand investments in AI infrastructure. Expanding Investment Despite Trade Pressures The company plans to significantly boost capital spending next year to meet surging global demand, though it did not specify an amount. Earlier this month, SK Hynix and Samsung Electronics (OTC:SSNLF) secured initial deals to supply chips and equipment for Microsoft Corporation (NASDAQ:MSFT)-backed OpenAI's Stargate project. In September, the U.S. Commerce Department withdrew the waivers previously granted to Samsung and SK Hynix that permitted them to import American semiconductor manufacturing equipment for their operations in China. Price Action: SK Hynix shares have surged 218.93% in 2025, outpacing Samsung's 87.27% rise and the KOSPI index's 69.02% gain, reflecting investor confidence in its dominant role in the AI-driven chip market. According to Benzinga's Edge Stock Rankings, Nvidia ranks in the 97th percentile for Growth. Click here to see how it compares with peers. Read Next: Trump Turnberry Is 'Our Monalisa' Says Eric Trump As He Shrugs Off Millions In Losses -- 'We Don't Give A...' Photo Courtesy: JHVEPhoto on Shutterstock.com Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. MSFTMicrosoft Corp$544.502.44%OverviewNVDANVIDIA Corp$204.436.76%SSNLFSamsung Electronics Co Ltd$42.480.34%Market News and Data brought to you by Benzinga APIs

Chipmakers poised to enter super-cycle as AI demand, DRAM shortages drive growth - The Korea Times

With both Samsung Electronics and SK hynix reporting record third-quarter earnings, Korea's semiconductor sector is poised for a strong performance next year, potentially entering a super-cycle, analysts said Thursday. According to financial data provider FnGuide, Samsung Electronics' consensus estimates for next year -- based on the average of brokerage forecasts -- anticipate revenue of 367 trillion won ($257 billion) and operating profit of 63 trillion won. SK hynix is expected to record 118 trillion won in revenue and 59 trillion won in operating profit, bringing the combined operating profit of the two companies to more than 120 trillion won. Analysts expect the semiconductor market to enter a super-cycle in 2026, driven by factors such as expanding artificial intelligence (AI) and data center demand, rising high-bandwidth memory (HBM) requirements and robust dynamic random access memory (DRAM) prices. The two Korean chipmakers are forecasted to surpass their previous earnings records in the coming year, a trend already reflected in their third-quarter performance. Samsung Electronics reported third-quarter revenue of 86 trillion won, up 8.8 percent from the same period last year. Operating profit surged 32.5 percent to 12 trillion won, marking a return to the 10 trillion won level for the first time in about a year. Its Device Solutions division, responsible for semiconductors, posted record quarterly memory sales with 33 trillion won in revenue and 7 trillion won in operating profit, a 19 percent increase from the previous quarter. Samsung's business outlook remains strong as it signed its largest-ever foundry deal -- worth 23 trillion won -- with Tesla, entered a chip supply agreement with Apple and is participating in OpenAI's massive Stargate project. SK hynix also set a quarterly record, with third-quarter operating profit rising 61.9 percent year-on-year to 11 trillion won, while revenue increased 39.1 percent to 24 trillion won. According to industry tracker Counterpoint Research, SK hynix maintained its leading position in the global DRAM market for the third consecutive quarter, capturing a 35 percent revenue share. The company continues to hold a strong presence in the HBM market. In a conference call, SK hynix said its HBM products have been sold out since 2023, with prices remaining at profitable levels. Shipments of its sixth-generation HBM, HBM4, which meets all customer performance requirements, are scheduled to begin in the fourth quarter following the completion of development and mass production setup. Ryu Hyung-geun, an analyst at Daishin Securities, noted that concerns over potential DRAM shortages are prompting companies to secure memory chips in advance, creating strong demand and pushing semiconductor prices higher. "As this FOMO (fear of missing out) effect strengthens in the memory market, the industry's entry into a super-cycle is accelerating. Standard DRAM prices are expected to rise about 15 to 20 percent in the fourth quarter compared with the previous quarter," Ryu said. On Thursday, Samsung Electronics rose 3.58 percent to close at 104,100 won, while SK hynix gained 1.79 percent, ending at 568,000 won.

SK hynix Q3 operating profit reaches $7.93 bil. - The Korea Times

SK hynix set a new quarterly earnings record in the third quarter, powered by strong artificial intelligence (AI) chip sales and higher memory prices. The company said Wednesday that its sales and operating profit for the July-to-September period stood at 24.45 trillion won ($17.04 billion) and 11.38 trillion won, respectively. This marks a new quarterly earnings record for the chipmaker, driven by rising prices of DRAM and NAND flash memory and increased shipments of high-performance products for AI servers, such as high-bandwidth memory (HBM). "Due to expansions in AI infrastructure, overall demand for memory chips has sharply increased," the company said. "Sales of 12-high HBM3E chips, Double Data Rate 5 (DDR5) DRAMs for servers and other high-value products have grown, allowing us to surpass the previous quarter's record-high earnings once again." In particular, shipments of server DDR5 products with capacities exceeding 128 gigabytes more than doubled from the previous quarter, the company said, adding that the sales mix of high-value enterprise SSDs for AI servers also improved. SK hynix said the AI market is rapidly shifting toward inference-focused applications, leading to clients to distribute computing workloads from AI servers to general-purpose servers and other infrastructure. This trend is expected to result in a demand expansion across a wider range of memory products, including high-performance DDR5 and enterprise SSDs. To cope with growing demand, SK hynix said it will expedite its transition to 1c fabrication process, which is more advanced than the current 1b process. The company plans to expand supply by establishing a full lineup of DRAM products for servers, mobile devices and graphics applications to better respond to customer needs. The 1c process refers to the sixth-generation manufacturing process within the 10-nanometer class, which is divided into six stages -- 1x, 1y, 1z, 1a, 1b and 1c. The progress reflects finer node dimensions. In the NAND segment, it aims to increase the supply of products based on its industry-leading 321-layer technologies to promptly meet client demand. The company added that it has already completed negotiations for next year's HBM supply with major clients, and the latest HBM4 products will begin shipping in the fourth quarter of this year. SK hynix has completed the mass production system for HBM4 in September. In order to address increasing customer demand, SK hynix plans to expand its production capacity through M15X fab, where equipment installation has recently begun after the early opening of a new cleanroom. "With the innovation of AI technology, the memory market has shifted to a new paradigm and demand has begun to spread to all product areas," SK hynix Chief Financial Officer Kim Woo-hyun said. "We will continue to strengthen our AI memory leadership by responding to customer demand through market-leading products and differentiated technological capabilities."

SK Hynix Posts Record Earnings on Continued AI-Chip Demand

SK Hynix, the main supplier of high-bandwidth-memory products to Nvidia, posted record quarterly earnings as robust artificial-intelligence investments by big global tech companies continued to fuel demand for its advanced AI chips. The South Korean memory-chip maker attributed the stellar third-quarter performance to brisk shipments of higher-end HBM3E products as well as higher prices for DRAM chips used in data servers for AI training and mobile devices. Analysts have said they expect the AI boom, which requires high-performance chips, to continue into next year. Surging demand for enterprise solid-state drives also helped improve earnings at the company's NAND chip business. Net profit more than doubled from a year earlier to a record 12.598 trillion won, equivalent to $8.80 billion, for the three months ended September, SK Hynix said Wednesday. That topped a previous high set in the first quarter of this year and beat market views. Analysts had expected a bottom line of 8.491 trillion won, according to a FactSet consensus estimate. It also posted record revenue and operating profit for the quarter. The top line climbed 39%, to 24.449 trillion won. Operating profit exceeded 10 trillion won for the first time, jumping 62%, to 11.383 trillion won. Shares in SK Hynix closed 2.6% lower on Tuesday ahead of the results on profit taking after recent gains. Still, the stock has nearly tripled this year, driven by investor enthusiasm about AI. The company was ahead of rival HBM manufacturers in supplying 12-layer HBM3E products, which currently dominate the premium segment of the AI-chip market, and is poised to repeat that feat with the next-generation memory product. SK Hynix said Wednesday that it completed discussions with key customers about next year's HMB supply. It said HBM4 shipments would start in the fourth quarter of 2025 ahead of a full-scale sales expansion in 2026.