SK hynix operating profit surges 557% on AI boom, but shares tumble as expectations outpace reality

Memory maker SK hynix's profit rises 557% amid global shortage, expansion costs climb to $27 billion -- shares slide despite mammoth earnings as expectations outpace reality and global AI selloffs continue

Q3 DRAM bit shipments are guided up around 10%, one quarter after average selling prices climbed roughly 30%. SK hynix reported second-quarter revenue of 79.32 trillion won and operating profit of 60.54 trillion won on Wednesday, the latter up 557% year over year at a record 76% operating margin, and used the same Seoul earnings call to lift its 2026 capital spending guidance to the high 40 trillion won range as AI server demand keeps outrunning what the company can produce. Third-quarter DRAM bit shipments are guided up around 10% sequentially, following a quarter in which DRAM average selling prices rose roughly 30%, and NAND prices rose in the mid-50% range. SK priced 177.9 million American depositary receipts at $149 each earlier this month, raising $26.51 billion in the largest share sale by a non-U.S. company on record, with the SEC filing earmarking proceeds for Korean manufacturing facilities and equipment, including EUV scanners. Wednesday's capex number is roughly the same size and funds an accelerated mass production schedule at the M15X fab in Cheongju, the Yongin Phase 1 cleanroom that opens in early 2027, and the previously announced P&T7 advanced packaging plant and M17 NAND base, which SK hynix said will be built in phases according to customer demand. Cash and short-term investments hit 88 trillion won at the quarter's end, up 33.6 trillion won in three months, against interest-bearing debt of 18.6 trillion won and a debt-to-equity ratio of 7%. CEO Kwak Noh-jung called 2027 the worst year of the shortage on the day of the Nasdaq listing and put the end of the crunch beyond 2030. Full-year DRAM demand is growing at a mid-20% rate by the company's own estimate, against bit shipments guided up around 10% next quarter. None of the capacity now being funded will produce wafers before 2027. Operating profit landed below the 64.1 trillion won that brokerages surveyed by Yonhap Infomax had modeled. Executives attributed the softer blended DRAM ASP to product mix and to high-value shipments pushed into the second half, and said the gap should close as HBM4 and 1c-node conventional DRAM ramp up. HBM4 entered mass production during the quarter, and HBM4E samples have shipped, with volume production targeted for 2027. Triggered by global selloffs, SK hynix closed down around 10% in Seoul on Wednesday, and Samsung Electronics fell 5%, with the KOSPI ending the session 6% lower and below 6,000 for the first time since April 14. The index touched 5,262 at one point, down almost 13%, taking its five-session decline to 17% and cutting a year-to-date gain that had reached 116% in June to 34%. Over the past month, SK hynix has lost 47% of its value and Samsung 37%. The KOSPI fell 10.84% on Tuesday and triggered a marketwide circuit breaker after SK hynix's American depositary receipts dropped below the $149 price at which they listed on Nasdaq on July 10. Weaker shareholder-return expectations compounded the earnings miss, with SK hynix telling analysts only that additional returns remain under evaluation and would be disclosed within the year. Josh Gilbert, eToro's lead analyst for Asia-Pacific and the Middle East, told Bloomberg that "expectations had simply moved ahead of what even another record quarter could deliver." CXMT closed its Shanghai debut up 466% on Monday after raising 57.92 billion yuan for DRAM wafer lines, and a report last week put China at low-volume production of domestic immersion DUV scanners running to around five units this year. TrendForce still has conventional DRAM contract prices rising 13% to 18% in the third quarter, with NAND up 10% to 15%. Follow Tom's Hardware on Google News, or add us as a preferred source, to get our latest news, analysis, & reviews in your feeds.

Big Tech demanding deals that smooth out memory prices, says SK Hynix

South Korean memory-maker SK Hynix has revealed that it's struck "around ten" long-term supply deals with key customers, many of them AI players, and hopes the deals smooth out volatile memory prices. The company revealed the deals today, along with Q2 results that saw quarterly revenue reach ₩79.3 trillion ($54.5 billion), a 257 percent year-over-year increase. Operating profit grew by an even larger number: 557 percent year-over-year to ₩60.5 trillion ($41.6 billion). The memory-maker even achieved the unusual feat of delivering more net income than revenue, thanks to asset sales. Underlying all that growth was an average 30 percent increase in the average price customers paid for DRAM, a 50 percent rise in the prices paid for NAND memory, along with increased shipments. But the company predicted slow growth in Q3, with NAND shipments rising by a low single-digit percentage and about ten percent more DRAM to leave SK Hynix's factories. Some of that memory will be HBM4, which execs said will ship in increased volume and mean average selling prices rise higher still, as will earnings. Execs pointed to the company's colossal expenditure on additional manufacturing capacity but said they see no risk of creating oversupply because the AI industry has a voracious appetite for memory and will do for the foreseeable future. Indeed, company president Song Hyeon-jong said SK Hynix's relationship with customers "is evolving beyond transactional relations into more strategic long-term partnerships" and said that behavior "serves as the evidence of the sustained demand coming from the AI ecosystem." SK Hynix's big customers are therefore typically doing deals that last up to five years and structuring those arrangements to keep prices steady. "The objective is to reduce uncertainty arising from short-term market volatility while enhancing long-term business stability for both our customers and SK Hynix," Song said. "At the same time, it is equally important to secure effective purchase commitment, given the impact that demand volatility can have on the memory cycle," he added. "In addition to long-term volume commitments, the agreements include mechanisms such as deposits that can strengthen contract implementation and demand visibility." All of which sounds rather like SK Hynix's big customers are trying to keep memory prices as low as possible, by helping the Korean company to manage its cashflow so it can keep cranking out more chips. Head of investor relations Park Seong-hwan argued that demand for memory and storage will remain strong for years to come, even if major AI companies find themselves with more datacenter capacity than they need. Park said hyperscalers leasing their datacenters is a sign of increased utilization rates for existing AI infrastructure. He also brushed aside adoption of more efficient models as a trend that could be bad for memory sales, suggesting better models spur demand for AI services and therefore also for more infrastructure. "This view is also supported by the medium-to long-term demand outlook we have discussed with our key customers," Park said. The company also argued that agentic AI will spur demand for more memory, including in servers. "We are witnessing a structural shift in demand where both AI memory and conventional memory are growing together," the company wrote in its earnings release. Investors appear not to have been impressed by those arguments, or SK Hynix's profits, as the company's share price has dropped around five percent at the time of writing. ®

SK Hynix profits soar sixfold on AI boom

SK Hynix reported a more than sixfold increase in quarterly earnings, driven by demand for its advanced memory chips on the back of the AI boom. The world's second-largest memory-chip maker said on Wednesday that its operating profit surged 557 per cent to a record Won60.5tn ($42bn) in the three months to June 30 compared with the same period last year, although that was below a forecast of Won64tn by LSEG SmartEstimate. Sales rose 256 per cent to Won79.3tn ($50.7bn), also below analyst estimates of Won83.9tn. SK's shares rose about 3 per cent in morning trading as the South Korean company said it had secured multiyear contracts with about 10 customers. The stock has fallen about 47 per cent from its June peak amid growing doubts over the durability of AI spending by America's biggest tech companies. The stock had gained more than sevenfold over the past year before the recent sell-off. This is a developing story

RAM prices be damned, SK hynix's record-breaking $55.6 billion quarter still failed to meet investors' wild AI expectations

SK hynix, one of the 'big three' memory manufacturers, just shared its 2026 second quarter financial results, and its record-breaking revenue of 79.3 trillion won (roughly $55.6 billion) isn't all good news. Despite continuing strong demand for memory from the AI industry, SK hynix has found itself missing investor expectations. Poor lamb. SK hynix was forecast to cross a slightly more face-melting profit threshold of 84 trillion won (about $58 billion) by the end of June. Analysts attribute the miss to a slowing of HBM4 shipments, with revenue from those to be recorded next quarter instead. To be clear, the 79.3 trillion the company actually made is far from disastrous, and still represents a 257% year-over-year boost to quarterly revenue. However, missing the revenue forecast has manifested in a share slump of about 9.6%. The stock itself has also halved in value (though that does mean it's still up by 115% so far this year). Reuters further reflects that investors have been frustrated by SK hynix not detailing how they'll benefit directly from the AI boom. But let me doff the stockbroker visor for a moment: it looks like investors may finally be getting the memo that big tech's aggressive AI spending or its infrastructure build-out cannot last forever. As for SK hynix itself, the company expects "the momentum in memory demand [...] to persist." Therefore, it's moving to expand "multi-year contract discussions with customers to secure mid-to-long-term supply stability." The company says its finalised long-term agreements (which typically run for five years) with 10 customers. So, is the AI bubble finally popping? SK hynix doesn't appear to think so. In fact, the company says it's planning to raise capital spending to around 40 trillion won ($27.6 billion) this year in order to support the demand it anticipates. Little says 'confident' like many trillions of won -- and such confidence can be one tactic deployed to guard against a further dip in share price. As for PC gamers though, the memory supply crisis will continue to rage, driving up the price of RAM and SSDs with it (if you're in the market for an upgrade, I collate the best SSD deals here). As for the wider consumer electronics industry, further price spikes from memory suppliers are on the way, but they may at least slow down in frequency -- however, that's because actual supply could drop by as much as 70% next year according to at least one prediction.

SK hynix posts 1,200% net profit boost on AI chip boom

Seoul (AFP) - South Korea's SK hynix said Wednesday second-quarter net profit soared a whopping 1,242 percent year-on-year, driven by the artificial intelligence industry's explosive demand for its advanced memory chips. SK hynix is a specialist supplier of high-bandwidth memory chips to US industry behemoth Nvidia, and a pillar of South Korea's tech-led economy. The global race to build data centres hosting AI infrastructure has seen a meteoric rise in the firm's fortunes, despite concern the sector may be overvalued in a market bubble. Wednesday's earnings figures, including quarterly net profit of 94 trillion won ($64 billion), were described in a statement by the Icheon-headquartered firm as "an all-time high quarterly performance". "We are aware of concerns that AI infrastructure investment might be slowing down," marketing chief of the AI microchip division Park Joon-deok said on a call with investors and reporters. He cited jitters over firms exploring data centre rental -- rather than construction -- and the emergence of new high-efficiency AI requiring a lower memory taskload. "We view these developments not as a scaling back of AI investment, but rather as a process of maximising the utilisation of the massive AI infrastructure built to date and accelerating its monetisation," he said. Wednesday's report said operating profit between April and June jumped 557 percent from last year to 60 trillion won. Revenue stood at 79 trillion won, with the differential to the net profit boosted by SK hynix's one-off sale of its 20 trillion won stake in flash memory maker Kioxia -- another beneficiary of the AI boom. SK hynix said it intends to make investments in the 40 trillion won range this year. Growth was attributed to expanding investments in AI infrastructure as the technology evolves into more complex forms requiring more high-bandwidth memory capacity. "With major tech companies increasing their AI infrastructure investments, additional supply requests continue to mount," the company said in a statement. "As these investments are supported by revenue generated from AI services, the momentum in memory demand is expected to persist." Big US listing Parent firm SK Group announced on Saturday plans for a new $500 billion collaboration with Nvidia to invest in AI infrastructure. Earlier this month, SK hynix also raised $26.5 billion through an American Depositary Receipt listing in the US, one of the world's largest-ever equity offerings. Despite aggressive investments, shares of SK hynix and its larger South Korean rival Samsung Electronics have fallen sharply by 33 per cent and 41 per cent respectively over the past month. SK hynix shares tumbled 14 percent on Tuesday, the day before the earnings release. The dip has been caused by concerns about AI industry sustainability and conflict in the Middle East spooking investors, KB Securities analyst Kim Dong-won said in a note on Monday. Nonetheless, Kim forecast memory chip prices are likely to rise "at least 30 percent in the third quarter" with supply shortages likely to persist through to 2028. Samsung Electronics is due to report its quarterly earnings on Thursday. The company has forecast second-quarter operating profits to increase 1,800 per cent on last year.

SK hynix reports record Q2 2026 profit, but shares drop after results miss expectations

SK hynix is one of the big three when it comes to memory, so it's no surprise that the company's latest earnings report for Q2 2026 reflects a record-high operating profit thanks to the demand for HBM and other high-performance memory. With KRW 60.5 trillion in profit, this represents a 557% increase year-over-year; however, even this astronomically high figure failed to meet expectations. Throw in overall revenue of KRW 79.3 trillion, a 257% increase from a year ago, and SK hynix's share price still managed to drop by over 9% on Wednesday. One reason the company's Q2 performance fell short is continued DRAM price increases and SK hynix's inability to pass them on because it has long-term supply agreements (LTAs) with key customers already in place. Reporting indicates approximately 50% of the company's total sales were made via these long-term contracts. But these lower prices are temporary, with several of these contracts concluding. And with SK hynix beginning to mass produce and ship next-gen HBM4 memory, it's expected that demand from the AI and data center markets will continue to increase as next-gen systems like NVIDIA's Vera Rubin begin to roll out in volume. HBM4 memory is widely viewed as a critical component in this next generation of AI hardware, with all of the big three (SK hynix, Samsung, and Micron) on board to supply HBM4 to NVIDIA. "With major tech companies increasing their AI infrastructure investments, additional supply requests continue to mount," the company said. "As these investments are supported by revenue generated from AI services, the momentum in memory demand is expected to persist." And with that, analysts are already predicting another 30%, at least, price increase for memory in Q3 2026, with the supply shortfall expected to persist through 2028.

Why SK Hynix shares crashed despite record Q2 earnings - Record profits fail to impress investors

Why SK Hynix shares crashed despite record Q2 earnings 1/7 Record profits fail to impress investors South Korean memory chip giant SK Hynix saw its shares plunge sharply after reporting record second-quarter earnings. Despite a more than six-fold jump in operating profit, investors focused on weaker-than-expected results, delays in next-generation AI memory shipments, and concerns over the sustainability of the AI spending boom. The selloff dragged South Korea's tech-heavy market lower and sparked a broader rout in semiconductor stocks. (Sources: Reuters, CNBC, EBC Financial Group) 2/7 Revenue and profit hit all-time highs SK Hynix posted record quarterly revenue of about 79.3 trillion won, while operating profit surged 557% year-on-year to approximately 60.5 trillion won. Net profit also soared, supported by robust demand for high-bandwidth memory (HBM) chips used in artificial intelligence servers. However, the headline numbers fell short of lofty market expectations. 3/7 Why did the stock fall? Analysts had anticipated even stronger earnings, particularly on operating profit. Investors were also disappointed by slower-than-expected shipments of HBM4 memory chips and only modest gains in conventional DRAM prices. With AI-related stocks trading at elevated valuations, even a slight earnings miss triggered heavy profit booking. 4/7 AI boom faces fresh scrutiny The results reinforced concerns that spending by major AI infrastructure companies may be moderating after an extraordinary investment cycle. Investors are increasingly questioning whether explosive AI-related demand can justify current semiconductor valuations, leading to broad selling across AI-linked technology stocks. 5/7 Long-term outlook remains positive Despite near-term concerns, SK Hynix maintained an optimistic outlook. The company expects AI-driven memory demand to remain strong through 2027 and plans to increase capital expenditure to expand production capacity. It is also securing multi-year supply agreements with customers to stabilize revenue and strengthen its leadership in AI memory chips. 6/7 Tech selloff spreads across Asia SK Hynix's decline weighed heavily on South Korea's equity market, contributing to a sharp drop in the Kospi index. Other semiconductor companies, including Samsung Electronics, also came under pressure as investors reassessed AI-related valuations across the sector. The weakness spilled over into broader Asian markets, although some non-tech sectors remained resilient. 7/7 Key takeaway for investors SK Hynix's results highlight how elevated expectations have become in the AI era. While the company continues to benefit from booming demand for advanced memory chips and remains fundamentally strong, investors are now demanding not just record earnings but consistent outperformance and clear visibility on future growth.

SK Hynix Has a Warning for Tech Buyers: Your Next Laptop or Phone Could Cost More Because of This - SK hy

AI's Growing Memory Appetite is Tightening Supply During the earnings call, Hyun-Jong Song, president and head of SK Hynix's Corporate Center, said the company is seeing "temporary sales adjustments" in PC and mobile markets because customers are facing difficulties securing memory. However, Song said those segments could regain momentum as supply constraints ease and AI services become more widely adopted. Why Laptop and Smartphone Prices Could Rise Memory chips, including DRAM and NAND, are essential components in smartphones, laptops and other consumer electronics. If supplies remain constrained and chip prices rise, device manufacturers could face higher production costs. While SK Hynix did not say that consumer electronics prices would increase, the company's comments suggest that persistent supply pressure could eventually affect device pricing, configurations or availability. Song said DRAM demand is expected to grow by the mid-20% range, while NAND demand is projected to rise by the high teens. He warned that the supply-demand balance may not improve significantly in the near future. "The increasing complexity of advanced processes applied to HBM and AI server memory" is making it harder to expand production quickly, Song said, adding that new manufacturing facilities also require lengthy construction timelines. SK Hynix Reports Record Revenue, 76% Margin SK Hynix reported second-quarter operating profit of 60.54 trillion won ($41.62 billion), up 557% year over year but below LSEG SmartEstimate's 64 trillion won ($43.99 billion) forecast. Revenue surged 257% to a record 79.32 trillion won ($54.53 billion), while net profit reached 93.92 trillion won ($64.56 billion), partly driven by nonoperating gains. The company also posted a record 76% operating margin. The results were SK Hynix's first since its Nasdaq-listed ADR debut earlier this month. Price Action: SK Hynix closed down 8.98% at $130.17 on Tuesday and further declined 3.05% in pre-market trading on Wednesday. Benzinga Edge Stock Rankings place SKHY in the 97th percentile for Growth, though the stock has underperformed across the short, medium and long term. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo courtesy: Samuel Bolvin / Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

SK hynix Went All In On HBM, And Paid For It With A Bruising Miss On Consensus Expectations For Q2'26

Things are about to get very ugly for at least one of the so-called 'Big Three' memory players, as SK hynix has just reported a bruising miss on consensus expectations, courtesy of its heavy tilt towards AI-centric HBM. SK hynix misses Q2 2026 consensus expectations for its revenue and operating profit by 5.4 percent and 5.9 percent, respectively SK hynix has just reported $54.6 billion (79.3 trillion won) in revenue vs. a consensus estimate of $57.7 billion (83.9 trillion won). Also, the high-flying memory player has disclosed an operating profit of $41.6 billion (60.5 trillion won) against a consensus estimate of $44.2 billion (64.2 trillion won). These numbers, however, still equate to an year-over-year growth of 257 percent and 557 percent for revenue and operating profit, respectively. Apparently, this bruising miss is a direct function of SK hynix's HBM-heavy sales mix. Given the fact that commodity DRAM is currently commanding a premium over HBM, SK hynix's ASP growth rate was lower than the market average. Despite this miss, the overall paradigm in the memory sphere is not expected to change, with SK hynix's CEO going so far as to proclaim recently that 2027 "will be the worst year in the industry's history from the supply perspective." Do note that SK hynix's Yongin Y1 fab will come online in February 2027, while the Y2 will do so in H2 2028. As such, the company is expected to supply 18 billion GB of HBM in 2026 and 24 billion GB in 2027. Meanwhile, perhaps realizing the problems with its overwhelming skew towards HBM, SK hynix is trying to pivot back towards consumer DRAM, aiming to start delivering LPDDR6 RAM to customers within H2 2026. It's also hedging its bets by bringing LPDDR6 to the SOCAMM standard for AI datacenters. We have tuned in to SK hynix's earnings call and will update this post with any valuable nuggets of information that we glean during the call. Follow Wccftech on Google to get more of our news coverage in your feeds.

SK Hynix's record profit misses forecasts; shares slump 10% despite robust AI chip demand

The Nvidia supplier's quarterly operating profit soared more than sixfold to a record high, but it said delays in shipments of some advanced products limited price gains for its mainstay dynamic random access memory (DRAM) chips. Shares in SK Hynix tumbled 10% as the weaker-than-expected earnings heightened investor concerns about the sustainability of ⁠aggressive AI spending ⁠by tech firms. South Korean chipmaker SK Hynix reported bumper quarterly results on Wednesday but fell short of lofty investor expectations fuelled by the AI boom, with the company racing to secure long-term supply deals to cushion the memory industry's volatile demand cycles. The Nvidia supplier's quarterly operating profit soared more than sixfold to a record high, but it said delays in shipments of some advanced products limited price gains for its mainstay dynamic random access memory (DRAM) chips. Shares in SK Hynix tumbled 10% as the weaker-than-expected earnings heightened investor concerns about the sustainability of ⁠aggressive AI spending ⁠by tech firms. "There are concerns that tech firms will take a breather in infrastructure spending," Lee Min-hee, an analyst at BNK Investment & Securities, said. Investor sentiment was further hurt by the company's failure to provide detailed plans for sharing the benefits of the AI boom through higher shareholder returns, analysts said. While disappointing investors, the company said memory chip demand remained strong. "Major customers are still requesting more memory supply," SK Hynix President Song Hyun-jong said on an earnings call, adding that it was seeking more long-term supply agreements to better manage chip price volatility. The move underscores how chipmakers are trying to convert today's AI-driven boom into longer-term demand certainty amid concerns that spending on AI infrastructure could eventually cool. Long-term agreements include financial safeguards such as deposits to ensure contract implementation. The company has concluded talks on around 10 such deals and is continuing discussions with other major industry players, it said. The move comes as worries about the ability of "hyperscalers" like ⁠Microsoft, Alphabet, Amazon, Meta Platforms and Oracle to fund hundreds of billions of dollars of planned investment in AI infrastructure have driven down chip shares globally in recent weeks. AI demand remains robust Despite those concerns, SK Hynix struck an optimistic note on AI memory demand, saying major technology companies continue to expand investments in AI infrastructure. "With major tech ⁠companies increasing their AI infrastructure investments, additional supply requests continue to mount," the company said. "As these investments are supported by revenue generated from AI services, the momentum in memory demand is expected to persist." While long-term deals improve visibility over future demand, they may also temper near-term pricing gains, contributing to the earnings miss, analysts said. SK Hynix also has higher exposure to high-bandwidth memory (HBM) chips, whose prices rose less than conventional memory, they said. Bigger rival Samsung Electronics has estimated a 19-fold jump in second-quarter operating profit and is due to report its results on Thursday. "Samsung has greater pricing power and has raised prices more aggressively than SK Hynix," said Lee Su-rim, an analyst at DS Investment & Securities. Reflecting its confidence in future demand, SK Hynix said it plans to raise capital spending this year to the high-40 trillion won range, up from 30.173 trillion won in 2025, to expand chip production capacity. The company downplayed concerns that its capacity expansion could lead to oversupply, saying it would adjust investments in line with market demand. Buoyed by its strong earnings, SK Hynix's net cash reached 88 trillion won at the end of June. It aims to increase that to more than 100 trillion won to better respond to customer demand and stabilise business operations. With the company's cash balance approaching its long-term target, investors are increasingly focused on how that cash will be deployed, said Kim Sunwoo, ⁠a senior analyst at Meritz Securities. SK Hynix said it could not yet provide details on the timing, size or structure of its shareholder return policy, but planned to disclose the plan later this year. "SK needs to come up with a concrete shareholder return policy to turn around investor sentiment," said Greg Roh, head of research at Hyundai Motor Securities. The company reported an operating profit of 60.5 trillion won ($41.62 billion) for the April-June period, compared with 9.2 trillion won a year earlier and short of a 64 trillion won forecast by LSEG SmartEstimate, which is weighted toward analysts who are more consistently accurate. Quarterly revenue rose 257% to 79.3 trillion won. Net profit rose more than 13-fold to 93.9 trillion won, driven in part by 63.3 trillion won in gains related to investment assets, it said, without providing further details. Analysts estimated that the company recognised cumulative investment gains following the completion last month of the sale of its stake in Japanese NAND flash memory maker Kioxia. SK Hynix invested about 4 trillion won in Kioxia in 2018 through a Bain Capital-led consortium of U.S., Japanese and South Korean investors, participating via two special purpose vehicles. ($1 = 1,453.7200 won)

SK hynix shatters Q2 earnings record amid AI peak concerns - The Korea Times

An SK hynix advertisement appears on a billboard in Times Square, New York, July 10. Courtesy of SK hynix SK hynix shattered its quarterly earnings record in the second quarter, just three months after setting its previous high. Still, its shares extended losses Wednesday as the record results failed to meet elevated market expectations, adding to concerns that the artificial intelligence (AI) infrastructure investment boom may be losing momentum -- a claim the Korean chipmaker dismissed. During its earnings call, SK hynix said its second-quarter operating profit soared 557.2 percent from a year earlier to 60.54 trillion won ($41.6 billion). Revenue for the quarter reached 79.32 trillion won, up 256.8 percent year-on-year. Both revenue and operating profit set new records, surpassing the previous highs of 52.58 trillion won in revenue and 37.6 trillion won in operating profit. Its operating margin reached 76 percent. However, the results fell short of brokerages' consensus estimates of 83.94 trillion won in revenue and 63.99 trillion won in operating profit. The company attributed the strong performance to continued demand driven by expanding AI infrastructure investment, with higher prices for high-performance AI server memories lifting earnings. Its first-half revenue exceeded 100 trillion won for the first time. "Prices for both DRAM and NAND posted sharp increases from the previous quarter," SK hynix said. "We achieved record profitability by expanding sales of high-value-added products, including high-bandwidth memory (HBM), AI server DRAM and enterprise solid-state drives." During the earnings call, the company said it is receiving growing supply requests from Big Tech companies expanding AI infrastructure investment. Based on the demand outlook, it is engaging customers on multiyear contracts and concluded negotiations on long-term agreements (LTAs) with around 10 customers, including key clients. "The standard LTA term is typically five years, but the specific terms may vary depending on the customer and the product," the company said. "Rather than adopting a single pricing model, we are discussing various pricing structures with customers to help address price volatility." To reduce earnings volatility tied to the memory cycle, SK hynix and other memory chipmakers have been expanding LTAs. Despite those efforts, investors remain haunted by the worry that a slowdown in AI infrastructure investment could eventually lead to an oversupply of memory chips. SK hynix shares fell 9.48 percent before noon Wednesday, following a 14.65 percent drop in the previous session. Excluding Wednesday's decline, the stock has suffered four single-day losses of more than 10 percent this month. "We believe the industry is moving into a stage of improving utilization and accelerating the monetization of the infrastructure that has already been built, rather than entering a phase of reduced AI investment," the company said. "As our capacity expansion will remain flexible, we believe the likelihood of mid- to long-term investment immediately leading to an oversupply is limited." The company said it is considering additional shareholder return measures and plans to disclose them to the market later this year. It also said that its American depositary receipts listed in the United States can be converted into common shares beginning Thursday. The company began mass shipments of HBM4 in the second quarter and plans to significantly ramp up production in the second half. It has also completed the sample deliveries of the next-generation HBM4E in the first half and plans to start mass production next year. SK hynix said it expects overall shipment growth in the second half to outpace that of the first half, driven by a significant increase in HBM4 shipments and higher shipments of conventional DRAM based on its sixth-generation 10-nanometer-class process. "A higher proportion of HBM4 and other high-value-added products in our sales mix will contribute positively," the company said. "As a result, we expect our earnings momentum to strengthen further in the second half, supported by both higher shipment volumes and rising average selling prices." Regarding its NAND business, the company said its 321-layer NAND products already account for the largest share of its total production, and it plans to expand their share to about 50 percent of its domestic production capacity by the end of the year. To meet growing demand, SK hynix said it has accelerated the production schedule for its M15X fab while investing to rapidly expand capacity. It said its mid- to long-term investment plans, including the recently announced P&T7 advanced packaging facility, the M17 NAND production base and the new semiconductor cluster, will be carried out in phases based on customer demand and investment efficiency.

$600 billion wiped out in a month, cracks exposed in SK Hynix chips

SK Hynix shares have seen a significant decline recently. Concerns about market overcrowding and leverage have impacted the stock. Recent reports on Chinese progress fueled further worries about capacity. Despite expected record earnings, investors are becoming cautious about memory chip prices. The company's stock still shows strong annual gains due to its AI leadership. A nearly $600 billion rout in just a little over a month has flipped SK Hynix. from one of the world's hottest artificial intelligence trades to one of the biggest portfolio question marks. Shares of the South Korean memory chipmaker have plunged 47% from their all-time high in June on concerns about overcrowding and a surge in leverage-induced volatility. Its loss in market value over that span rivals that of even SpaceX. US MarketsPowered By As on 29 Jul 2026, 01:30 AM IST S&P 500 Top Gainers IQVIA Hldgs242.94(13.94%) Incyte129.93(9.30%) Sherwin-Williams354.27(8.25%) Workday159.69(8.24%) Gainers" S&P 500 Top Losers Corning126.01(-12.10%) Carrier Global63.16(-8.90%) Micron Technology820.53(-8.85%) Coterra Energy32.56(-8.62%) Losers" The stock tumbled almost 15% Tuesday after The Information reported on Chinese progress with deep ultraviolet (DUV) lithography machines, fueling concerns over a potential flood of new capacity amid broader worries over the AI rally. Record earnings expected While SK Hynix is likely to report another quarter of record earnings on Wednesday as the AI boom drives chip prices higher, investors are turning skittish. The primary fear is that rising memory costs will force customers to reduce usage and turn to cheaper alternatives. "The debate now is whether memory is taking too much of the pie," said Andy Wong, head of multi-asset at Pictet Asset Management HK, whose fund has reduced its position in SK Hynix in recent weeks. The market wants to see if "anything can shift the perception that SK Hynix is squeezing too much margin out of the supply chain." Also Read: Global Market Today: Oil jumps on renewed Middle East tension, US stock futures dip The chipmakers's shares have greater implications for global investors since the listing of its American depositary receipts, which have fallen below their July 9 offering price. The proliferation of leveraged exchange-traded funds tied to the stock has also grabbed attention due to the unprecedented volatility they have unleashed. Triple-digit annual gains The stock is still on track for another year of triple-digit gains, buoyed by the firm's early lead in high-bandwidth memory for AI. This month's pullback tracks broader caution over the tech hardware sector as doubts multiply over the durability of hyperscaler outlays.

SK Hynix Stock Falls 9% After Profit Misses AI Chip Market Forecasts

Net profit rose more than 13 times to 93.9 trillion won. Investment gains played a major role in that increase. Analysts linked much of the gain to the completed sale of SK Hynix's indirect stake in Japanese flash-memory maker Kioxia. Meanwhile, demand for high-bandwidth memory continued to support SK Hynix earnings. HBM chips serve data centres that train and operate artificial intelligence models. The company has secured long-term supply agreements with about 10 customers and continues negotiations with other buyers. SK Hynix said customers are seeking longer contracts as memory supply stays tight. These agreements include financial protections intended to reduce risks from changes in customer demand. The company also plans 2026 capital spending of about 47 trillion to 48 trillion won. Even so, delays in some reduced revenue recognition during the quarter. Price gains for standard DRAM products also came in below earlier expectations. Those factors contributed to the operating profit and revenue misses. Management maintained its positive demand view for the second half of 2026. The company expects AI server investment and limited memory supply to support sales. However, the latest figures show that record growth must also clear high market forecasts.

Needham initiates SK Hynix stock coverage with buy rating on AI demand By Investing.com

Investing.com - Needham initiated coverage on SK Hynix Inc. (NASDAQ:SKHY) with a buy rating and set a price target of $200. The stock currently trades at $142.72 with a P/E ratio of 18.29, which InvestingPro data identifies as a low earnings multiple relative to near-term earnings growth. The firm cited the company's market leadership position across memory products. SK Hynix holds the number one position in high-bandwidth memory and DRAM, and the number two position in NAND as of 2025, according to IDC. Needham said SK Hynix is positioned as a full-stack memory enabler of artificial intelligence infrastructure. The company is benefitting from robust demand for AI infrastructure and a rising pricing environment due to industry-wide capacity constraints. This demand has translated into impressive financial results, with revenue growth of 145% over the last twelve months and gross profit margins of 70%. For deeper insights, InvestingPro offers 15 additional exclusive tips and a comprehensive Pro Research Report for SKHY. The firm noted SK Hynix has entered into five-year long-term agreements with approximately 10 leading customers as of the second quarter of 2026. The company's leadership position in high-bandwidth memory and the continued build out of AI infrastructure support its outlook. The $200 price target is based on approximately six times the firm's calendar year 2028 earnings per share estimate. Needham said the long-term agreements should drive reduced variability in memory pricing and more predictable financial results. In other recent news, SK Hynix has been the subject of multiple analyst ratings. Rosenblatt Securities initiated coverage of SK Hynix with a buy rating, emphasizing the company's leadership in high-bandwidth memory technology and changes in the memory industry's capacity growth. Wolfe Research also initiated coverage, assigning an outperform rating and projecting 2027 earnings per share of 460,505 Korean won, approximately $32.19 in U.S. dollars. The firm highlighted the strength of the memory market due to DRAM industry limitations and new supply agreements. William Blair initiated coverage with an outperform rating, citing significant revenue and earnings growth driven by artificial intelligence memory demand. The firm noted that limited supply expansion has led to a tripling of prices in the past six months, resulting in record revenues and margins for SK Hynix. Stifel also initiated coverage with a Buy rating, focusing on the company's role in AI memory infrastructure and the strong demand for DRAM as a component of AI hardware. Additionally, Morgan Stanley upgraded its stock rating on Korea to overweight, following what it described as a leverage washout in the market. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Why is SK hynix stock rallying today? By Investing.com

Investing.com -- SK hynix stock rose 3.2% in pre-open trading after the company jointly unveiled the first standard specifications for High Bandwidth Flash (HBF) technology with SanDisk at the FMS 2026 conference in Santa Clara, California. The new open standard, published through the Open Compute Project, positions HBF as a next-generation memory tier sitting between High Bandwidth Memory and conventional SSDs -- directly targeting the bandwidth and capacity bottlenecks that constrain large-scale AI inference workloads. The HBF specification supports capacities up to 512GB via stacked NAND dies and offers three bandwidth grades reaching approximately 3.0 TB/s, using the UCIe chiplet interconnect to integrate with CPUs and GPUs. Critically, Google and Tenstorrent confirmed participation in the HBF consortium, lending significant ecosystem credibility to the standard. SK hynix also publicly revealed its tenth-generation V10 375-layer 4D NAND for the first time, a product that delivers 2.5 times better performance per watt than its predecessor and is targeted squarely at AI data center environments. Adding further momentum, two Wall Street firms published bullish initiations around today's move. BofA Securities resumed coverage with a Buy rating and a $250 ADR price target, pointing to SK hynix's dominant position in high-end memory, long-term chip orders from U.S. Big Tech, and a record 76% operating margin in Q2 2026. Wolfe Research separately initiated with an Outperform rating and a $200 price target, projecting robust earnings growth through 2027 and 2028 on the back of strong DRAM and NAND pricing trends. The broader market provided a supportive backdrop, with the NASDAQ gaining 0.8% and the S&P 500 adding 0.2%. Together, today's HBF ecosystem announcement -- coming just six months after the consortium's launch -- combined with high-conviction analyst coverage and a recovering macro environment to drive a meaningful pre-market rebound for SKHY, which had been pressured in the prior session by geopolitical risk-off sentiment tied to renewed U.S. strikes on Iran. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

SK Hynix posts sixfold rise in Q2 profit on AI chip demand, misses forecasts

SEOUL, July 29 (Reuters) - South Korean chipmaker SK Hynix reported a more than sixfold increase in quarterly operating profit to a record high on Wednesday, driven by robust demand for advanced memory chips as big technology firms ramped up spending on AI data centres. The Nvidia supplier reported an operating profit of 60.5 trillion won ($41.62 billion) for the April-June period, compared with 9.2 trillion won a year earlier. But it missed a 64 trillion won forecast by LSEG SmartEstimate, which is weighted toward analysts who are more consistently accurate. "Driven by sustained demand growth from expanding AI infrastructure investments, high-performance products for AI servers led price increases, enabling the company to surpass its previous record set in the prior quarter," SK Hynix said in a statement. SK Hynix missed analysts' forecasts because its higher exposure to high-end memory chips used in AI data centres than rivals meant it benefited less from a stronger price rally in conventional memory chips. The company said its quarterly revenue rose 257% to 79.3 trillion won. ($1 = 1,453.7200 won) (Reporting by Heekyong Yang and Joyce Lee; Editing by Jamie Freed)

William Blair initiates SK Hynix stock coverage with outperform rating on AI memory demand By Investing.com

Investing.com - William Blair initiated coverage on SK Hynix Inc. (NASDAQ:SKHY) with an outperform rating, citing strong growth driven by artificial intelligence memory demand. The firm said SK Hynix has achieved significant revenue and earnings growth driven by AI memory demand across HBM, LPD, DDR, and QLC products. Limited near-term supply expansion has caused prices to triple in the last six months and pushed the company to record revenues and margins. The company's gross profit margin reached an impressive 70% in the last twelve months, reflecting strong pricing power in AI memory products. William Blair estimates free cash flow will more than double to $239 billion by 2028 after increasing more than six times this year. The firm said much of the cash flow may be returned to shareholders. SK Hynix pioneered HBM technology, partnering with AMD as early as 2013 to develop standards. The company held 56% of the HBM market share in the first quarter, according to William Blair. InvestingPro subscribers have access to 15 additional exclusive tips and a comprehensive Pro Research Report on SK Hynix, offering deeper insights into the company's competitive position. The firm identified potential risks including increasing competition in HBM as competitors Samsung and Micron may gain allocation with new hybrid bonding technology, greater competition from Chinese manufacturers in traditional DRAM and NAND markets, negative pricing pressure as additional supply comes online, and slower demand for AI memory. In other recent news, SK Hynix reported record second-quarter 2026 results, with revenue reaching KRW 79.3 trillion and operating income hitting KRW 60.5 trillion, both marking all-time highs for the company. This surge was attributed to strong demand from AI infrastructure and tight supply conditions, which also led to significant increases in DRAM and NAND prices. Despite these impressive financial results, SK Hynix's stock experienced a decline in trading. Additionally, investment banks have shown confidence in SK Hynix's future, with Stifel initiating a Buy rating and setting a price target of $240.00, while UBS also initiated coverage with a Buy rating and a price target of $204.00. These ratings reflect the company's strong position in AI memory infrastructure. Meanwhile, South Korea's finance ministry announced measures to impose limits on single-stock leveraged exchange-traded funds, aiming to stabilize the market. Morgan Stanley upgraded its stock rating on Korea to overweight, following what it described as a leverage washout in the market. These developments highlight the dynamic environment for SK Hynix and the broader Korean market. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

SK Hynix stock initiated at Buy by Stifel on AI memory demand By Investing.com

Investing.com - Stifel initiated coverage on SK Hynix Inc. (NASDAQ:SKHY) with a Buy rating and a price target of $240.00, citing the company's position in AI memory infrastructure. SK Hynix is a leading supplier of advanced DRAM and NAND memory-based storage products and devices. The memory industry is experiencing strong demand as DRAM serves as a vital component of AI hardware infrastructure. The company holds a leading share position in high bandwidth memory, exceeding 60% in 2025. SK Hynix developed and commercialized HBM, a specialized DRAM product designed to feed data to GPUs and accelerators for AI model training and inference.This market leadership has translated into strong financial performance, with revenue surging 145% over the last twelve months and gross profit margins reaching 70%. According to InvestingPro data, analysts have set price targets ranging from $152 to $355, with the platform offering additional ProTips and comprehensive analysis for investors. Memory industry pricing has increased year-to-date, with average selling price per bit rising more than two times in DRAM and more than four times in NAND. Stifel projects industry bit supply growth of approximately 20% in 2027, potentially half of unconstrained capacity. The firm's $240 price target is based on seven times its calendar year 2027 earnings per share estimate. Stifel expects equipment and cleanroom availability to remain constraints in 2027-28. In other recent news, SK Hynix reported record second-quarter 2026 financial results, with revenue reaching KRW 79.3 trillion and operating income hitting KRW 60.5 trillion, both all-time highs for the company. This surge in performance was attributed to increased demand from AI infrastructure and tight supply conditions, alongside significant rises in DRAM and NAND prices. Despite these strong results, SK Hynix's stock experienced a decline in trading. Additionally, UBS initiated coverage on SK Hynix with a buy rating, citing a positive outlook on AI demand, and set a price target of $204. Meanwhile, South Korea's finance ministry announced plans to impose limits on single-stock leveraged exchange-traded funds, aiming to stabilize the market. These measures include a cap on investments and increased trading costs, alongside a 24-hour stock market monitoring system. Morgan Stanley has also upgraded its stock rating on Korea to overweight, following a leverage washout in the market. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.