SK Hynix Q3 Profit Jumps 7x on AI Memory Boom
SK Hynix posted record Q3 profit of 83.33 trillion won as AI demand for HBM4 memory surged, with DRAM and HBM volumes effectively sold out through 2029.
SK Hynix has posted the biggest quarter in its history. The South Korean chipmaker reported record revenue and operating profit for the July to September quarter, powered by surging demand for the high-bandwidth memory chips that sit inside AI data centers. The results beat analyst forecasts by a wide margin and sent Korean chip stocks sharply higher.
Record quarter by the numbers
Revenue for the third quarter reached 104.62 trillion won, up 327.89 percent from a year earlier and the first time the company's quarterly revenue has crossed the 100 trillion won mark. Operating profit jumped 632.25 percent to a record 83.33 trillion won, about 62.8 billion dollars, topping the 76.96 trillion won consensus compiled by market tracker FnGuide. The operating margin hit roughly 80 percent, also a company record. Net profit climbed 215.71 percent to 39.78 trillion won. That figure came in below the 61.29 trillion won forecast, with the company pointing to non-operating costs including currency losses and investment write-downs.
Why AI memory is driving it
The engine of the quarter is high-bandwidth memory, or HBM. These chips are stacked close to AI processors to feed them data fast enough, and SK Hynix is the leading supplier of HBM to Nvidia. The company said growing shipments of its sixth-generation HBM4 chips and a sharp rise in server DDR5 sales lifted its DRAM business, while sales of high-capacity enterprise solid-state drives kept its NAND business growing too. SK Hynix expects HBM4 to overtake the previous HBM3E generation in both shipment volume and revenue in the fourth quarter. It also plans to maximize production capacity at its Cheongju M15X plant by year-end to meet demand.
Sold out through 2029
Demand is outrunning supply by so much that SK Hynix says its DRAM and HBM volumes are effectively sold out through 2029. The company has signed long-term agreements with 14 key customers, mostly on five-year terms, covering more than half of its planned production capacity for 2027 and 2028. The company expects the memory supply shortage to continue through 2030 as investment in AI data centers keeps expanding. That outlook helped settle, at least for now, fears of an AI investment bubble and a looming memory glut.
A $75 billion payout to shareholders
Alongside the results, SK Hynix unveiled a shareholder return plan worth roughly 100 trillion won, about 75.4 billion dollars, for the 2026 fiscal year. The package includes more than 30 trillion won in cash dividends and more than 60 trillion won in share buybacks and cancellations, including a 40 trillion won buyback already completed. The third-quarter dividend alone is 20,000 won per share, or 14 trillion won in total, funded by gains from the sale of its stake in Japanese chipmaker Kioxia. The payout is nearly seven times last year's 14.3 trillion won return, reflecting the flood of cash the AI memory boom is generating.
What it means for the AI trade
Markets reacted fast. SK Hynix shares jumped 10.89 percent to finish at 1,487,000 won, Samsung Electronics surged 9.01 percent, and the Kospi index closed up 6.63 percent at 6,012.44 points, its biggest single-day gain since July 31. In US premarket trading, Micron rose 4 percent and Nvidia gained 0.8 percent. The result is a strong counter to doubts about AI spending. Memory has become a critical constraint on AI growth rather than a routine component, and the company supplying most of it is now booking orders years into the future. Attention now turns to the next test of the AI trade: quarterly results from Microsoft and Alphabet, due after markets close on Wednesday.
Sources
- Reuters - https://www.reuters.com/world/asia-pacific/sk-hynix-q3-profit-jumps-more-than-7-fold-beats-forecasts-2026-10-27/ - Korea JoongAng Daily - https://www.koreajoongangdaily.com/business/sk-hynixs-q3-operating-profit-surges-more-than-sevenfold-to-record-628b-beating-forecasts/12941760