- South Korean giant finalises roughly 10 long-term agreements with key customers and remains in active talks with others.
- SK Hynix plans to spend in the high-40 trillion won range on capital expenditure this year, up steeply from 30.17 trillion won in 2025.
SK Hynix posted the biggest quarterly profit in its history on Wednesday. It wasn’t enough.
The world’s second-largest memory chipmaker reported 60.5 trillion won ($41.62 billion) in operating profit for the April–June quarter, a six-fold surge from a year earlier. Revenue jumped 257 per cent to 79.3 trillion won. Net profit exploded more than 13-fold to 93.9 trillion won, fattened by a massive one-off investment gain.
The culprit: slower-than-expected shipments of high-bandwidth memory, or HBM, the ultra-fast stacked DRAM that powers Nvidia’s AI accelerators and sits at the core of every major data centre buildout.
Pricing restraint bites
One factor behind the miss was SK Hynix’s deliberate pricing strategy. The company raised prices more conservatively than arch-rival Samsung Electronics, particularly on multi-year contracts.
The move reflects a calculated bet: lock in supply relationships spanning years, even at the cost of near-term margins, rather than squeeze every won from the current cycle.
The earnings landed at a jittery moment for chip stocks. A sell-off has swept through the sector in recent weeks as investors question whether the hyperscalers — Microsoft, Alphabet, Amazon, Meta, and Oracle — can sustain the hundreds of billions of dollars pledged to AI infrastructure.
SK Hynix pushed back firmly.
“With major tech companies increasing their AI infrastructure investments, additional supply requests continue to mount,” the company said in its earnings statement. “As these investments are supported by revenue generated from AI services, the momentum in memory demand is expected to persist.”
Locking in demand
The company is not just talking about confidence — it is structuring it. SK Hynix disclosed it has finalised roughly 10 long-term agreements with key customers and remains in active talks with others. The contracts include upfront deposits and other financial mechanisms designed to improve demand visibility and stabilise fulfilment.
The push marks a structural shift for an industry long defined by violent boom-and-bust swings.
Cash piles up, capex rises
SK Hynix plans to spend in the high-40 trillion won range on capital expenditure this year, up steeply from 30.17 trillion won in 2025.
The balance sheet can handle it. Net cash hit 88 trillion won at June’s end, and the company is eyeing the 100 trillion won threshold — a war chest it says will allow it to respond faster to customer needs while smoothing operations through the cycle.
The Kioxia windfall
A chunk of the quarter’s staggering net profit did not come from chips at all. The company booked 63.3 trillion won in investment gains, which analysts overwhelmingly attribute to the cumulative recognition of profits from the sale of its stake in Japanese NAND flash memory maker Kioxia.
SK Hynix invested roughly 4 trillion won in Kioxia in 2018 through a Bain Capital-led consortium. The sale, completed last month, ranks among the most lucrative financial bets in semiconductor history.