SK Hynix's record quarter tops 100 trillion won in sales at an 80% margin and lifts Nasdaq futures
The memory maker beat estimates on revenue and operating profit, plans about 100 trillion won in shareholder returns this year and expects HBM4 to become its main high-bandwidth product in the fourth quarter.
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The AI chip rally got a fresh push from South Korea overnight. SK Hynix, one of the world's largest makers of memory chips, reported record quarterly results that beat estimates by a wide margin, and Nasdaq 100 futures rose as the news spread through global markets, according to Investing.com.
The numbers
SK Hynix said third-quarter revenue reached 104.6 trillion won, the first time its quarterly sales have topped 100 trillion won. Operating profit came in at 83.3 trillion won, giving an operating margin of about 80%. Seoul Economic Daily put the precise margin at 79.7%, a record for the company, up from 76.3% in the second quarter.
The growth rates are hard to overstate. Revenue rose 327.9% from a year earlier, and operating profit rose 632.1%, according to CNBC and Seoul Economic Daily. Compared with the second quarter, revenue climbed about 32% and operating profit about 38%, the company said.
Analysts had expected less. CNBC, citing LSEG SmartEstimates, said the forecast was 98.34 trillion won in revenue and 76.72 trillion won in operating profit. Seoul Economic Daily cited estimates of 98.23 trillion won and 76.96 trillion won, putting the beats at 6.5% and 8.3%.
Net profit was 39.8 trillion won, much lower than operating profit. SBS reported that the gap reflected foreign exchange losses from a stronger won and other non-operating items, so the operating line is the cleaner read on the business.
What drove it
Prices did a lot of the work. Average selling prices for DRAM rose by a high-20s percentage from the previous quarter, according to CNBC and Newsquawk, helped by higher prices for conventional memory and a bigger share of high-bandwidth memory, or HBM, the stacked memory that sits next to AI processors.
SK Hynix said HBM4, the newest generation, began shipping in earnest during the quarter, and that it expects HBM4 to surpass the older HBM3E in both shipments and revenue in the fourth quarter. To meet demand, it plans to run its M15X plant in Cheongju at full capacity by the end of the year, the company and CNBC said.
The company also said it has secured long-term agreements covering more than 50% of its 2027 to 2028 production capacity, a structure it described as reflecting market conditions while keeping profitability stable.
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Cash back to shareholders
SK Hynix said it plans about 100 trillion won in shareholder returns this year, including at least 30 trillion won in cash dividends plus share buybacks and cancellations, a figure confirmed by CNBC, Seoul Economic Daily and NewDaily. The board approved a 20 trillion won buyback, half of which is earmarked for cancellation, NewDaily and CNBC reported.
The market reaction
The stock closed 10.89% higher in Seoul, outpacing a 6.63% gain in the Kospi, CNBC reported. SK Hynix's U.S.-listed shares rose 7.9% to $156.78 in premarket trading, according to Benzinga.
The memory results landed as Nasdaq 100 futures were rising between roughly 0.3% and 0.6% early Wednesday, while Dow futures slipped about 0.2%, according to Investing.com and TipRanks. That followed Tuesday's 1.18% gain in the Nasdaq Composite, led by chip stocks.
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Not every chip report landed well
The glow did not reach everyone. NXP Semiconductors fell about 9% after hours on Tuesday when its fourth-quarter revenue outlook came in roughly in line with expectations, CNBC reported, and Stocktwits had it down 6.5% early Wednesday after its operating profit forecast fell short of the FactSet consensus. Seagate Technology slid between about 5% and 6% after hours despite beating estimates and guiding above expectations, according to CNBC and XTB.
The split shows how high the bar has become. Companies tied directly to AI memory and data center demand are being rewarded for big beats, while results that are merely in line, or a beat paired with a cautious outlook, are being sold.
Why it matters today
SK Hynix is one of the first large AI hardware suppliers to report this week, and its numbers suggest demand for memory used in AI servers was still accelerating through September. Microsoft and Alphabet report after the close on Wednesday, after the Fed's 2 p.m. decision, and both will be asked how much they plan to keep spending on the data centers that use those chips.
