SK Hynix reported record third-quarter results on Wednesday, 28 October. Operating profit rose 632% from a year earlier to 83.3 trillion won (about $62bn). Revenue rose 328% to 104.6 trillion won, it said in its earnings release. It is the first time the South Korean memory maker’s quarterly sales have passed 100 trillion won.
Its operating margin reached 80%. Net profit was 39.8 trillion won, down 58% from 93.9 trillion won in the second quarter.
The company also said it expects demand for memory chips to outstrip supply until the end of the decade.
“Given technical difficulty of leading-edge processes and the long lead time required to build new production facilities, it expects the structure in which demand exceeds supply to persist through 2030,” SK Hynix said.
Half of 2027 and 2028 already booked
SK Hynix has signed long-term agreements with 14 major customers, including large cloud providers. Together they cover more than half of its production capacity for 2027 and 2028. The contracts typically run five years, and prices move with the market within a range agreed with each customer.
HBM4, the high-bandwidth memory used alongside AI chips, started shipping in volume in the quarter. SK Hynix expects it to overtake HBM3E in shipments and revenue in the fourth quarter. Its M15X plant will reach full capacity by the end of the year. Investment will rise significantly next year, when the first phase of its Yongin chip cluster enters full operation.
On the earnings call, it said average DRAM prices rose by a high-20s percentage on the quarter. Server DDR5 shipments rose more than 40%, Jenny Lee reported for CNBC.
Chief financial officer Kim Woo-hyun expects PC and mobile shipments to fall as memory prices rise. Simon Sharwood reported his comments for The Register. Apple CEO John Ternus has called the shortage a memory crisis.
About 100 trillion won for shareholders
SK Hynix plans to return about 100 trillion won to shareholders for 2026. That includes at least 30 trillion won in cash dividends. Buybacks and cancellations add at least 60 trillion won, counting the 40 trillion won buyback from August. Most of this year’s gains from its Kioxia stake will go to shareholders as a special dividend.
“The customer trust built through our technological competitiveness is leading to long-term contracts, and our business structure is transforming into one with earnings stability and mid-to-long term demand visibility,” chief executive Kwak Noh-Jung said.
Kwak also said SK Hynix had stopped considering a stock market listing for Solidigm, its US flash memory unit. He cited recent market conditions.
SK Hynix shares closed 10.89% higher in Seoul on Wednesday, CNBC reported. By Tuesday’s close, they had lost more than half their value since a June high, Huileng Tan reported for Business Insider. Samsung Electronics, which forecast a record quarterly profit earlier this month, reports its full results on Thursday.