SK Hynix, one of the world’s two largest memory chipmakers, has reported the most profitable quarter in its history. Demand from data-centre operators for the specialised chips that power artificial intelligence continues to outstrip supply.
The South Korean company said on Wednesday that operating profit for the third quarter reached 83.3 trillion won (roughly $60 billion). That is more than seven times the 11.4 trillion won earned a year earlier, and 37.6% above the April-June quarter. Revenue climbed 328% from a year ago to 104.6 trillion won, passing the 100 trillion mark for the first time.
Both figures beat expectations. Analysts surveyed by LSEG had forecast operating profit of about 76.7 trillion won. Net profit came in at about 39.8 trillion won.
Margins that few hardware makers can match
The operating margin reached roughly 80%, up from about 76% in the second quarter. The previous quarter’s records were revenue of 79.3 trillion won and operating profit of 60.5 trillion won, so the company has surpassed them in a single quarter.
According to Seoul Economic Daily, the result ranks SK Hynix third among global technology companies by quarterly operating profit. It trails Samsung Electronics at 107.4 trillion won and Nvidia at $63.7 billion.
Why memory is in such short supply
The driver is high-bandwidth memory, or HBM. These stacked chips sit alongside AI processors and feed them data fast enough to keep expensive accelerators busy. Nvidia is among SK Hynix’s biggest customers.
The company said demand for its next-generation HBM4 products and for AI-related memory generally remains strong. It expects supply to stay tight through 2030 and is expanding capacity for advanced DRAM and NAND flash. Long-term supply agreements already cover more than half of its planned 2027 and 2028 output, which gives it unusual visibility for a business once known for sharp swings.
Prices for conventional memory have also climbed as manufacturers shift capacity toward AI products, leaving less for phones, PCs and servers.
A payout of about 100 trillion won
The results came with an unusually large capital return plan. SK Hynix said it will distribute about 100 trillion won to shareholders this year. That includes at least 30 trillion won in cash dividends and about 60 trillion won in share buybacks and cancellations.
The third-quarter dividend is 20,000 won per share, a total of around 14 trillion won, and includes a special element funded by gains on its investment in Japan’s Kioxia. The company will also carry out a further 20 trillion won buyback, with half of the shares cancelled this year. It has just completed a 40 trillion won repurchase programme. Shares rose more than 8% following the announcement.
A boost for South Korea
The chip boom is reshaping the wider South Korean economy. Official data released on Tuesday showed gross domestic product grew 1% in the third quarter compared with the previous three months. The central bank said the semiconductor industry accounted for around half of that expansion.
South Korea’s KOSPI index rose more than 3% on Wednesday, extending a rally in Asian technology shares this week. Chipmakers such as Samsung Electronics, as well as suppliers across Japan, have also benefited.
The risks behind the record
The strength of the numbers rests on a narrow base of customers. A handful of large technology companies account for much of the demand, and their spending is under growing scrutiny.
Meta this week announced plans to raise as much as $95 billion in new equity to fund its build-out. Alphabet and Microsoft, which report results later today, will face questions about whether cloud revenue can justify record capital spending. If those companies slowed their investment, memory makers would feel the effect quickly.
Memory has also historically been a cyclical industry, with periods of shortage often followed by oversupply. SK Hynix argues that long-term contracts and the complexity of HBM manufacturing make this cycle different. Investors will watch whether competitors, particularly Samsung and Micron, close the gap in advanced memory.
For now, the message from Seoul is clear: the appetite for AI computing power has not yet reached its limit.
Soci
