SK hynix is poised to report record-setting first-quarter earnings, with its operating profit anticipated to surpass 40 trillion won ($29 billion). This exceptional performance is fueled by surging demand for AI memory solutions, signaling a robust industry upcycle for semiconductors.
The leading chipmaker is scheduled to release its Q1 results on April 23. Consensus figures compiled by FnGuide project an operating profit of 34.9 trillion won on revenues of 50.1 trillion won. These figures represent significant year-on-year increases of 369 percent and 184 percent, respectively, already marking a new quarterly record for the company.
Analysts further predict a substantial surge in profitability alongside these strong earnings, with operating margins expected to reach levels rarely observed within the highly competitive semiconductor sector.
Optimism surrounding SK hynix’s performance has grown following stronger-than-expected results from industry peers, including Samsung Electronics and Micron Technology. Both rivals reported impressive earnings surprises, primarily driven by the escalating demand for AI-driven memory solutions.
Micron notably achieved a quarterly operating profit of $16.1 billion, an increase of over 800 percent from the previous year. Similarly, Samsung recorded a remarkable 57.2 trillion won in operating profit for its first quarter.
Focusing on operating margins, analysts project SK hynix’s overall memory product margins could approach 70 percent, with DRAM margins potentially soaring to 80 percent. Such figures would even surpass TSMC, which is widely recognized as the semiconductor industry’s benchmark for profitability.
For comparison, TSMC reported a 58.1 percent operating margin in the first quarter.
This robust earnings growth is a direct reflection of the sharp increase in AI server demand, which is boosting sales of high-margin High Bandwidth Memory (HBM) and driving a broad-based rise in DRAM prices. Additionally, strong demand for enterprise solid-state drives (SSDs), propelled by hyperscale data center investments, is providing crucial support for NAND flash pricing.
Market trackers estimate that SK hynix commanded a 35.2 percent share of the global DRAM market last year, slightly outperforming Samsung Electronics, which held 34.6 percent.
The promising outlook is prompting aggressive upgrades to full-year forecasts. Nomura Securities, for instance, has projected SK hynix’s annual operating profit could reach an impressive 256 trillion won. Furthermore, the combined operating profit for both Samsung and SK hynix may approach 580 trillion won.
Industry analysts suggest that the current semiconductor upcycle could sustainably extend for several years.
“Based on conservative demand assumptions and aggressive capacity expansion, memory markets are likely to remain in a state of undersupply through 2028,” stated Kim Young-gun, an analyst at Mirae Asset Securities.
This strong earnings momentum also highlights the critical importance of cash generation as SK hynix ramps up significant long-term investments, including its vast Yongin semiconductor cluster. To broaden its access to global capital, the company is pursuing a US listing via American Depositary Receipts (ADRs), targeting a launch in the latter half of this year.
SK hynix CEO Kwak Noh-jung has articulated a strategic goal of accumulating over 100 trillion won in net cash over time to ensure sustained investment capability, a substantial increase from approximately 12.7 trillion won recorded at the end of last year.
