SK hynix shares tumble despite record quarterly profit
Seoul, July 29
Shares of South Korean memory chip maker SK hynix fell sharply on Wednesday despite the company reporting its highest-ever quarterly operating profit and outlining plans for capital expenditure in the high 40 trillion won range this year, according to a news report by The Korea Herald.
SK hynix shares closed 8.98 per cent lower at USD 130.17 on Nasdaq, while trading 1.70 per cent higher in after-hours at USD 132.39, according to market data. Earlier in South Korea, the company's shares touched an intraday high of 1,619,000 won (USD 1,120) before reversing sharply to 1,266,000 won (USD 876), down 18.32 per cent, amid a broader market selloff.
The report added that the Korea Exchange halted trading for 20 minutes after the Kospi plunged 8.15 per cent, triggering an index-wide circuit breaker for a second consecutive session.
Despite the decline in its share price, SK hynix reported record quarterly earnings for the April-June period. Operating profit rose 557.2 per cent year-on-year to 60.54 trillion won (USD 41.9 billion), while revenue increased 256.8 per cent to 79.32 trillion won (USD 54.9 billion).
According to the report, the quarterly operating profit exceeded the company's total operating profit for all of 2025, which stood at 47.21 trillion won (USD 32.7 billion). Operating margin improved to 76 per cent, while first-half revenue reached 131.9 trillion won (USD 91.3 billion), crossing the 100 trillion won mark for the first time over a six-month period.
Net profit surged 1,242.5 per cent to 93.92 trillion won (USD 65.0 billion), although the report noted that the figure included 63.3 trillion won (USD 43.8 billion) in gains from the sale and revaluation of investment assets, largely related to the company's stake in Japanese flash memory maker Kioxia.
However, both revenue and operating profit came in below analysts' expectations. A survey by FnGuide had projected revenue of 82.58 trillion won (USD 57.1 billion) and operating profit of 63.15 trillion won (USD 43.7 billion). The company said shipments of some high-value products were carried over to the second half, resulting in blended DRAM average selling prices rising about 30 per cent, below market expectations.
During the earnings call, management said it expects capital expenditure this year to be in the high 40 trillion won (USD 27.7 billion) range as it accelerates mass production at the M15X fabrication plant and expands capacity ahead of the opening of the first Yongin plant's clean room in early 2027.
The company said capacity expansion would remain flexible and be based on confirmed demand. It also said it has completed negotiations on long-term supply agreements with about 10 customers, while discussions on 2027 volumes and pricing for high-bandwidth memory (HBM) products are continuing. The company added that it is reviewing additional shareholder returns and plans to announce details before the end of the year, the report noted.
— ANI
Reader Comments
Indian markets are also volatile these days. SK hynix is a giant in memory chips and this drop is just a knee-jerk reaction. The long-term story remains strong, especially with HBM demand for AI. But yaar, these circuit breakers in Korea are scary – reminds me of our own market circuit limits during the 2020 crash.
Operating profit up 557% and yet the market punishes them? 🤔 Must be the "missed expectations" game. Analysts always set the bar too high. I'd be happy if my company grew even 50%!
The net profit surge is misleading – 63 trillion won from selling Kioxia stake? That's not operational performance. Investors are smart to see through this. Also, capex of 40 trillion+ seems aggressive. Hope they don't overbuild capacity like in 2022 cycle. Very cautious from Indian perspective where we see our own semiconductor dreams struggling.
Circuit breakers triggered twice in a row? That's a bloodbath. But SK hynix is a bellwether – if they're seeing demand for HBM, it bodes well for AI chips globally. Just a matter of time before the price reflects the actual value. 👍
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