Topic: Key takeaways from the third-quarter 2026 US stock earnings season. SK hynix reported third-quarter operating profit that significantly beat analyst expectations. Operating profit surged 632% year over year. SK hynix shares closed up 11% on Wednesday.
On June 30, 2026, a corporate sign outside the SK hynix office building in Seongnam, South Korea. The South Korean chipmaker SK hynix announced record quarterly results, with profit far exceeding market expectations, while also unveiling a dividend and share buyback plan totaling more than $25 billion. The stock closed up 10.89% on Wednesday.
The following compares SK hynix's third-quarter results with the LSEG SmartEstimates analyst consensus, which gives greater weight to analysts with higher forecast accuracy:
Revenue: 104.62 trillion Korean won ($78.86 billion), versus an expected 98.34 trillion won. Operating profit: 83.33 trillion won, versus an expected 76.72 trillion won. Revenue jumped 327.9% year over year, while operating profit soared 632.1%. On a quarter-over-quarter basis, revenue rose 31.9% and operating profit climbed 37.6%. The stock's gain outpaced the Kospi index, which closed up 6.63%.
SK hynix achieved record highs in both revenue and operating profit, with quarterly revenue exceeding 100 trillion won for the first time. It also announced a plan to return about 100 trillion won to shareholders, including no less than 30 trillion won in cash dividends and no less than 60 trillion won in share buybacks and cancellations.
On the earnings call, SK hynix CEO Kwak Noh-jung said that due to financial market volatility and a pullback in the semiconductor sector, the company has ended its evaluation of a pre-IPO fundraising and listing plan for its US subsidiary Solidigm. The company said it will continue to assess the timing, scale and financing methods for investment in Solidigm to support its business growth and enhance shareholder value.
Kwak also said the company will return to shareholders the investment gains from its investment in Japanese chipmaker Kioxia. "We plan to return to shareholders, through a special dividend, the gains we made this year from our investment in Kioxia," he said. The company's board approved a third-quarter dividend of 14 trillion won, part of which comes from the special dividend funded by Kioxia investment gains.
The earnings call disclosed that, following the completion of a 40 trillion won share buyback last week—those shares will soon be cancelled—SK hynix will carry out another 20 trillion won buyback, with half of those shares to be cancelled this year. The company plans to raise its shareholder return target to more than 50% of cumulative free cash flow for 2025–2027.
With the spread of AI services and an increasingly diverse investor base, the company judges that the AI investment boom will continue. SK hynix also noted that the structural supply-demand imbalance in the memory market, with supply falling short of demand, will persist in the short term.
Mehdi Hosseini, a senior equity analyst at Susquehanna International Group, maintained a neutral rating on SK hynix after the third-quarter results, saying he prefers Micron Technology and Samsung Electronics over the Korean memory maker. He said Micron has a more diversified memory product portfolio, while Samsung has a foundry business, giving both a better risk-reward profile.
Hosseini also said SK hynix is undervalued, but he prefers the company's US-traded American Depositary Receipts (ADRs) over its locally listed Korean shares, citing a larger potential investor base in the United States. "I prefer its ADRs trading in the US market; I'm not sure the local Korean market can provide enough incremental buying," he said on "Asia Financial Morning."
Memory Capacity Expansion
SK hynix's M15X plant in Cheongju, South Korea, continues to expand production, and the company expects both HBM4 shipments and revenue in the fourth quarter to exceed those of HBM3E. High-bandwidth memory (HBM) is a high-end memory chip used with AI processors to handle massive amounts of data. HBM4 is the sixth generation in the series and entered mass production and shipment in the third quarter.
Driven by rising prices for conventional DRAM and a higher sales mix of high-priced HBM4, average selling prices for DRAM products rose sharply by more than 20% quarter over quarter. The earnings call disclosed that shipments of server DDR5 memory chips used in data center servers increased by more than 40% quarter over quarter.
SK hynix has now signed long-term supply agreements with 14 major customers, covering more than 50% of capacity for 2027–2028. The company expects the memory market's supply shortage to persist until 2030 and plans to significantly increase capital expenditure next year.
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