SK hynix posts KRW 104.6T Q3, warns shortage to 2030

SK hynix reported third-quarter revenue of KRW 104.6 trillion, its first quarterly sales above KRW 100 trillion, and said the memory supply shortage will persist through 2030 in its financial results press release.

The company recorded operating profit of KRW 83.3 trillion and net profit of KRW 39.8 trillion, corresponding to an operating margin of 80% and a net margin of 38%. Cash and cash equivalents stood at KRW 114.5 trillion at the end of Q3, up KRW 26.5 trillion quarter on quarter, while borrowings fell to KRW 15.8 trillion, down KRW 2.8 trillion. Net cash increased to KRW 98.7 trillion.

Production and product mix

SK hynix said sales of high-priced HBM4 memory for servers have expanded and expects HBM4 to overtake HBM3E in both volume and revenue next quarter. Server DDR5 sales also rose significantly, and demand for LPDDR5 SOCAMM for AI servers is growing. The new M15X fab is expected to ramp to full capacity by the end of the year, targeting 55,000 to 60,000 wafers per month of 1b DRAM chips. The company reported a rising share of next-generation 1c DRAM, used in its LPDDR6 products.

On NAND flash, SK hynix said sales of 321-layer TLC chips for embedded SSDs are growing and that production of those 321-layer chips will account for more than half of its domestic production capacity by the end of the year. The company is developing High Bandwidth Flash, or HBF, for AI servers; SK hynix described HBF as similar to HBM but intended for longer-term storage, allowing AI models to stream data that does not fit in RAM.

Market position and corporate decisions

The financial results press release included a warning that the memory supply shortage will persist through 2030. SK hynix said it plans to build production capacity faster but that it will take time to catch up; in the short term, the company expects enterprise and personal AI to make up the bulk of demand, with AI for autonomous driving and robotics contributing in the mid to long term.

According to a Counterpoint Research report from September, SK hynix was the second-largest DRAM maker globally by revenue with a 25% share, behind Samsung at 38% and ahead of Micron at 24%. The report noted that all three companies supply LPDDR and NAND memory to Apple and to most other smartphone makers, including Samsung.

Addressing the decision to discontinue review of a Solidigm IPO, SK hynix CEO Kwak Noh-Jung said, "The IPO was intended to raise external capital for the expansion of Solidigm's production facilities, and thereby to lighten our own investment burden and broaden our capacity for shareholder returns. However, after carefully considering recent financial market conditions and other factors, we concluded that proceeding at this time would not be the best way to achieve the originally anticipated outcome. We have therefore discontinued our review."