SEOUL, October 28 (AJP) - SK hynix cemented its dominance in the high-bandwidth memory (HBM) market crucial to powering artificial intelligence chips, reporting a fresh record quarterly operating profit of 83.33 trillion won ($62.9 billion) on Wednesday and signaling a strong earnings run for at least next two years, given its fat order backlog.
The South Korean memory chipmaker posted revenue of 104.62 trillion won for the July–September period, up 327.9 percent from a year earlier and 31.9 percent from the previous quarter, delivering a staggering operating margin of 79.7 percent.
Operating profit surged 632.1 percent from a year earlier and 37.6 percent from the previous quarter.
For the first nine months of the year, cumulative operating profit reached 181.49 trillion won on revenue of 236.51 trillion won.
The results beat the FnGuide market consensus of 76.96 trillion won in operating profit on revenue of 98.23 trillion won, implying an operating margin of about 78.3 percent.
SK hynix has been riding surging demand for HBM chips used in Nvidia's AI accelerators that power hyperscalers and data centers. The HBM pioneer, which commands more than half the global market, has faced intensifying competition from domestic rival Samsung Electronics as the industry transitions to HBM4.
The company said HBM4 shipments were ramping up and expected the next-generation memory to overtake HBM3E in both shipment volume and revenue in the fourth quarter.
It also said it had secured long-term supply agreements with 14 major customers, covering more than half of its planned production capacity for 2027 and 2028, as it forecast memory supply shortages lasting through 2030.
On Wall Street, its American depositary receipts (ADRs), which debuted in July, traded at $145.36 on Tuesday, up 1.9 percent ahead of the earnings release.
SK hynix shares have lost 25 percent this month amid concerns over excessive AI spending and have more than halved from their June peak of 2,987,000 won. The shares closed down nearly 8 percent at 1,374,000 won on Tuesday ahead of the earnings release.
The stock rose 1.6 percent to 1,362,000 won as of 9:07 a.m. Wednesday in Seoul.
The company also unveiled plans to return about 100 trillion won to shareholders this year, including at least 30 trillion won in cash dividends and more than 60 trillion won in share buybacks and cancellations, including the 40 trillion won buyback completed last week.
Its board approved a third-quarter cash dividend of 14 trillion won, equivalent to 20,000 won per share, including a special dividend of 10,000 won per share funded by gains from its investment in Japanese chipmaker Kioxia.
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