SK Hynix Reports Record Profit but Misses Forecasts, Shares Drop Amid AI Demand Concerns
South Korean chipmaker SK Hynix reported a record quarterly operating profit that surged more than sixfold. However, the results fell short of investor expectations due to delayed shipments and limited price gains for its DRAM chips. Despite strong demand from major customers for AI memory products, shares in SK Hynix dropped 9.6% as concerns grew over potential slowdowns in tech firms' AI spending. The company is seeking long-term supply agreements with key clients to manage chip price volatility and ensure stable demand amid uncertainty about the sustainability of current AI investment trends. These contracts typically last five years and include financial safeguards such as deposits. SK Hynix plans to increase capital expenditure this year, citing continued strong memory demand supported by revenue from AI services. Analysts noted that while long-term agreements provide visibility on future orders, they may limit near-term pricing gains—contributing to the earnings miss. The broader market also reacted negatively; the KOSPI index fell 6%. Meanwhile, SK Hynix's net cash surged to 88 trillion won at the end of June.
Topics: AI chips memory demand semiconductors stock market reaction