SK Hynix profit beat fuels $45 billion of dividends, buyback

SK Hynix Inc. unveiled plans to return about $45 billion more to shareholders after profit surged a stronger-than-expected seven-fold, reflecting the resilience of an AI infrastructure rollout that’s propelling memory chip demand.

The world’s second-biggest memory chipmaker reaffirmed it expects shortages of the components crucial to Nvidia Corp. accelerators to persist through at least 2030, propping up prices. On Wednesday, it reported an operating profit of 83.3 trillion won ($62.5 billion) for the September quarter, beating projections by more than 7%. 

The company also laid out plans to return 60 trillion won to shareholders in the remainder of the fiscal year through buybacks and dividends, on top of a previously announced 40 trillion won. Much of that stems from gains it locked in after a sale of stock in Kioxia Holdings Corp. earlier this year.

SK Hynix’s shares rose more than 7% in early Seoul trading, while rival Samsung Electronics Co. gained more than 8%. The results bolstered hopes for sustained profits from a surge in demand for memory from AI developers building data centers. That’s come under increasing scrutiny in recent weeks because of challenges in financing and setting up ambitious infrastructure projects. On Wednesday, executives said they were investing heavily in expanding capacity after the company sold out of all conventional and high-bandwidth AI memory till 2029.

“Investors have been questioning both the durability of AI demand and how much of the earnings windfall would ultimately reach shareholders,” said Jung In Yun, chief executive officer at Fibonacci Asset Management Global. “Today’s announcement helps address both concerns.”

SK Hynix and Samsung are among the biggest beneficiaries of the AI frenzy, supplying high-bandwidth memory to the likes of Nvidia while capitalizing on soaring prices of conventional memory chips. Its operating margins remain historically elevated, reflecting a persistent supply crunch.

What Bloomberg Intelligence Says

SK Hynix’s sales and operating profit look set to remain on an upward trend in 2027, supported by strong AI demand and higher memory prices, particularly for high-bandwidth memory. Its 3Q sales and operating profit beat consensus by 6% and 8%. AI agents require much more computing power than conventional chatbots, which could sustain demand growth for advanced AI processors and HBM over the next few years. Memory demand appears strong enough for Anthropic to flag potential supply shortages. Lam Research, a key 3D NAND equipment supplier, reports rising demand for high-speed, low-latency NAND for AI inference, suggesting further sales growth at SK Hynix and Samsung Electronics.

- Masahiro Wakasugi, analyst

Memory now constitutes roughly a third of all expenses related to AI data centers, according to research by Macquarie, and SK Hynix plays a key role in that business because of its close collaboration with Nvidia. That share of overall computing-hardware spending is expected to rise in the coming years as HBM prices are set to more than double in 2027, Macquarie said. 

SK Hynix has prioritized long-term contracts with customers including Nvidia. Like Samsung and Micron Technology Inc., it’s shifted production in recent years toward HBM, tightening supply of conventional memory.

The additional shareholder payouts could provide another catalyst for the stock price after the chipmaker abandoned a potential $10 billion US listing of its Solidigm unit after shareholder opposition and regulatory scrutiny. 

Solidigm is now in talks with the US Commerce Department to invest $45 billion in a new chip plant on American soil, Bloomberg News reported. A major producer of flash memory chips, it was the latest marquee name to shelve an initial public offering — joining data-center operators Firmus Grid Ltd. and AirTrunk as mounting AI-bubble concerns rattle global markets.

For now, SK Hynix’s outperformance is brightening sentiment and helping prop up the broader KOSPI — a day before Samsung is slated to report its own quarterly earnings. Kioxia too gained in Tokyo Wednesday.

SK Hynix “ticked all the check boxes with a significant operating profit beat, substantial shareholder return, and confident outlook on capex and shortages,” said Vey-Sern Ling, managing director at Union Bancaire Privee. 

“The fundamental demand outlook is clear and strong, and the company is investing to grow, and returning cash to shareholders.”

Published on October 28, 2026