SK hynix posts record third quarter as revenue tops 100 trillion won for first time

South Korean memory maker SK hynix reported record preliminary third-quarter results on October 28, with quarterly revenue passing 100 trillion won for the first time as the AI memory boom continued.

The numbers

On a consolidated preliminary basis, third-quarter revenue was 104.6155 trillion won, up 327.9% from a year earlier and 31.9% from the second quarter. Operating profit was 83.3338 trillion won, up 632.1% year on year and 37.6% quarter on quarter. Net profit was 39.7756 trillion won, and the operating margin reached a record 79.7%, up from about 72% in the first quarter and 76.3% in the second.

The results beat market expectations: the brokerage consensus had put revenue at about 96.7 trillion won and operating profit at about 76 trillion won, so actual figures came in roughly 8% and 10% higher.

AI memory demand drives growth

The company said rising prices for key products on growing AI memory demand, underpinned by the competitiveness of its high-value-added products, drove another all-time high. In DRAM, server DDR5 sales rose sharply and shipments of HBM4 began in earnest; in NAND, sales of 321-layer TLC enterprise SSDs expanded, with high-value-added data-centre products growing across the board.

Chief financial officer Kim Woo-hyun said operating profit and the margin set quarterly records despite unfavourable currency effects, driven by higher product prices and expanded sales centred on high-value products.

Sold out through 2029

Park Jun-deok, vice president in charge of DRAM marketing, said that over the next three years through 2029, virtually all of the company's DRAM and high-bandwidth memory volumes are effectively sold out, dismissing concern in parts of the market that memory demand has peaked.

Cash and cash equivalents stood at 114.5 trillion won at the end of the third quarter, up 26.5 trillion won from the end of the second quarter, while borrowings fell to 15.8 trillion won, leaving net cash of 98.7 trillion won.

Market reaction and what comes next

SK hynix shares rose as much as 9.4% in morning trading in Seoul on October 28. Attention now turns to Microsoft and Alphabet, which report after the U.S. market close on Wednesday, in a further test of returns on AI investment.

These are preliminary consolidated figures; detailed segment data will follow in the company's formal results.