Illustration of the SK Hynix company logo displayed on a smartphone screen.
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South Korea’s SK Hynix, one of the world’s largest memory chipmakers, posted a record quarterly profit on Thursday thanks to strong sales of high-bandwidth memory used in generative AI chipsets.
Shares of SK Hynix, however, fell 2.7% as Chief Financial Officer Kim Woohyun warned that the outlook for memory demand in 2025 was clouded by inventory adjustments by PC and smartphone makers as well as strengthening prices. protective trade policies and geopolitical risks.
Here are SK Hynix’s fourth quarter results compared to LSEG SmartEstimate, which are weighted to more precise analyst forecasts:
- Revenue: 19.77 trillion won ($13.7 billion) vs. 19.91 trillion won
- Operating profit: 8.08 trillion won ($5.6 billion) vs. 8.02 trillion won
Revenue rose about 75% in the October-December quarter from the same period a year earlier, while operating profit jumped 2,236% to 8.08 trillion year-on-year. .
On a quarterly basis, revenue increased 12%, while operating profit increased 15% to a new record.
The chipmaker has benefited from the rise of artificial intelligence servers and is a key supplier to the U.S. AI chip designer. Nvidia.
“With continued strong demand for AI memory, the company has achieved [an] record result thanks to cutting-edge HBM technology and a cost-effective operation,” SK Hynix said in its publication of results.
HBM is a type of dynamic random access memory, or DRAM, in which chips are stacked vertically to save space and reduce power consumption. Micron Technology and Samsung Electronics are the other key players in the HBM space.
SK Hynix’s strong fourth-quarter numbers cap a year in which the company achieved record annual revenue, surpassing the previous 2022 peak by more than 21 trillion won. Meanwhile, operating profit broke a record set in 2018 during a “super boom” in the semiconductor industry.
During the earnings conference call, SK Hynix management said the company could see a “slight increase” in capital expenditures in 2025 compared to the previous year.
Aside from demand uncertainty in 2025, the company expects sales growth of HBM and other DRAM products to continue as large technology companies continue to invest in AI servers and the training AI models is gaining ground.
The consumer market for AI-enabled PCs and smartphones is also expected to grow, with sales picking up in the second half, the company said.
“The memory industry is transitioning from a raw material market determined by volume and price to a personalized market focused on high-performance, high-quality products,” Kim said at the conference. telephone call on the results.
“Overall, this year, DRAM demand is expected to grow by a medium to high percentage, while NAND demand is expected to grow by a low percentage,” he added.
NAND is another type of memory chip that often works with DRAM in PCs, servers, and smartphones.
Speaking on CNBC’s “Street Signs Asia” on Thursday, SK Kim, an analyst at Daiwa Capital Markets, said SK Hynix’s fourth-quarter earnings were “pretty robust,” but noted that investors could worry about the market entering a period of adjustment. He added that SK Hynix would maintain its leading position within HBM.
Shares of SK Hynix have gained 29% since the start of the year, according to LSEG data.
Correction: This article has been revised to reflect updated quarterly growth data after SK Hynix amended its press release.
