SK Hynix surpassed the quarterly revenue mark of 100 trillion won for the first time in its history in the third quarter of this year, and recorded an operating profit in the 83rd trillion won range, rewriting its all-time high performance. The company continued its earnings growth trend as sales of high-value-added products such as HBM (High Bandwidth Memory) expanded, coupled with rising prices for commodity DRAM and NAND flash (hereinafter referred to as NAND).
SK Hynix disclosed on the 28th that it recorded consolidated revenue of 104.6155 trillion won and an operating profit of 83.3338 trillion won in the third quarter of this year. Revenue increased by 327.9% and operating profit by 632.1% compared to the same period last year. Both revenue and operating profit reached their highest levels ever. In particular, the operating profit increased by 22.7912 trillion won from the previous record high of 60.5426 trillion won in the second quarter.
Profitability also rose to an all-time high level. The third-quarter operating margin was approximately 80%, exceeding the 76.3% recorded in the previous quarter by about 3 percentage points (p). This figure is also about 21 percentage points higher than TSMC, the world’s largest foundry (semiconductor contract manufacturing) company, which posted a third-quarter operating margin of 58.7%. SK Hynix has led TSMC for four consecutive quarters, maintaining profitability at the highest level in the global semiconductor industry.
The expansion of revenue from HBM4, the sixth-generation HBM, is cited as a key driver of the improved performance. As investments by global big tech companies in AI (artificial intelligence) data centers expanded, demand for high-performance memory increased, and it is analyzed that the revenue contribution of HBM4 rose in the third quarter. SK Hynix began shipping HBM4 to major customers from the second quarter last year and has been expanding production capacity since the second half of the year.
Rising prices for commodity memory also supported the results. Increased demand for server DRAM due to AI server expansion led to higher commodity DRAM prices, while expanded demand for enterprise Solid State Drives (eSSD) pushed up NAND prices. Meritz Securities estimated that SK Hynix’s average selling prices (ASP) for DRAM and NAND in the third quarter rose by 22% and 15%, respectively, compared to the previous quarter. It is analyzed that increased sales of high-value-added products and overall memory price hikes led to improved profitability.
Meanwhile, SK Hynix is scheduled to hold a conference call for its third-quarter earnings announcement at 9:00 a.m. on the same day.
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