SEOUL – South Korea's SK hynix has revealed a staggering 1,242% year-on-year increase in second-quarter net profit, reaching an all-time high of 94 trillion won ($64 billion). This explosive growth is driven by the artificial intelligence industry's insatiable demand for its advanced memory chips. As a key supplier of high-bandwidth memory to industry giant Nvidia, SK hynix is at the forefront of the AI revolution, significantly bolstering South Korea's tech-driven economy.
The global race to construct AI-powered data centers has dramatically elevated SK hynix's financial performance. Despite concerns about potential overvaluation in the sector, the company's quarterly net profit marks an unprecedented achievement. The remarkable earnings, including an operating profit jump of 557% to 60 trillion won, underscore the intensifying investments in AI infrastructure.
Revenue for the quarter stood at 79 trillion won, with a notable 20 trillion won boost from the sale of its stake in flash memory maker Kioxia. SK hynix plans to invest around 40 trillion won this year, attributing its growth to the expanding investments in AI infrastructure as the technology becomes more complex and memory-intensive.
Park Joon-deok, marketing chief of the AI microchip division, addressed investor concerns about a potential slowdown in AI infrastructure investment. He highlighted the shift towards data center rentals and the emergence of high-efficiency AI requiring less memory, viewing these as opportunities to maximize existing infrastructure and accelerate monetization.
Despite aggressive investments, SK hynix and its rival Samsung Electronics have seen their shares tumble by 33% and 41% respectively over the past month, driven by concerns about AI industry sustainability and geopolitical tensions. However, analysts predict a continued rise in memory chip prices, with shortages expected to persist through 2028.
