As SK Hynix prepares to release its third-quarter earnings on October 28, attention is focused on whether the company will return profits from its stake in Japanese NAND flash maker Kioxia to shareholders.
According to securities analysts on October 26, SK Hynix is expected to announce additional shareholder return measures during its earnings conference call.
One of the proposed measures includes distributing dividends from the increased cash reserves resulting from the sale of its Kioxia shares. While specific details have yet to be finalized, the company is reportedly considering a plan to distribute investment gains to shareholders.
Previously, in 2018, SK Hynix participated in a consortium led by U.S. private equity firm Bain Capital to acquire the NAND business unit spun off from Toshiba, now known as Kioxia, for 2 trillion yen (approximately $17 billion). At the time of the acquisition, SK Hynix invested a total of 395 billion yen (about $3.3 billion).
In the first quarter of this year, SK Hynix sold part of its Kioxia stake, recovering 4.1178 trillion won, and it is estimated that the company generated around 20 trillion won in profits in the second quarter.
With the profits from the Kioxia sale exceeding 20 trillion won, SK Hynix's dividends for this year are expected to significantly surpass last year's total of 2.1 trillion won.
SK Hynix's shareholder returns have been on the rise each year. The company previously announced that it would utilize up to 50% of its cumulative free cash flow (FCF) from 2025 to 2027 for shareholder returns and increase its annual fixed dividend by 25% compared to previous levels.
In August, SK Hynix also revealed a shareholder return policy involving the acquisition and complete cancellation of 40 trillion won worth of its own shares. This buyback, initially scheduled for completion on November 19, was finished ahead of schedule on September 21.
* This article has been translated by AI.
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