SK hynix posts record quarter, warns memory shortage to last to 2030

SK hynix has reported its third-quarter results, and the headline figure is a milestone: revenue of 104.6 trillion won, the first time the company's quarterly sales have crossed the 100 trillion won mark.

The earnings release also carried a notable warning. According to the company, the shortage in memory supply will continue until 2030. In the near term, most of the demand is expected to come from enterprise and consumer AI applications.

Margins reach extraordinary levels

The income statement shows exceptional profitability alongside the record revenue. Operating profit came in at 83.3 trillion won and net profit at 39.8 trillion won, which works out to an operating margin of roughly 80 percent and a net margin of 38 percent.

The balance sheet is equally strong. Cash and cash equivalents at the end of the quarter stood at 114.5 trillion won, up 26.5 trillion won from the previous quarter. Debt fell by 2.8 trillion won to 15.8 trillion won, lifting the net cash position to 98.7 trillion won.

HBM4 and DDR5 sales are growing

On the server side, sales of expensive HBM4 memory expanded. SK hynix expects HBM4 to overtake HBM3E in both volume and revenue next quarter and become its main product. Server DDR5 RAM sales also rose markedly, and demand for LPDDR5 SOCAMM modules for AI servers is growing as well.

On the manufacturing side, the new M15X fab is expected to reach full capacity by the end of the year. The facility is projected to ramp to 55,000 to 60,000 wafers per month on 1b DRAM chips. The share of the next-generation 1c DRAM, which the company uses for LPDDR6, is also increasing.

NAND business and the HBF effort

In NAND flash, sales of 321-layer TLC chips used in embedded SSDs are growing. SK hynix expects these chips to account for more than half of its domestic NAND production capacity by the end of the year.

The company is also working on HBF (High Bandwidth Flash) for AI servers. Resembling HBM but designed for longer-term storage than RAM, the technology would let data that does not fit in RAM be fed to AI models.

Supply warning and the Solidigm decision

According to the earnings statement, the memory supply shortage will last until 2030. The company plans to expand production capacity faster, but says catching up with demand will take time. In the short term, enterprise and consumer AI will make up most of the demand; over the medium to long term, AI in autonomous driving and robotics will add to it.

CEO Kwak Noh-Jung also announced that plans for a Solidigm IPO have been dropped. The listing had been intended to bring in outside capital to expand Solidigm's production facilities and ease SK hynix's own investment burden. After weighing current financial market conditions and other factors, the company concluded that proceeding at this stage would not deliver the expected result and ended its review.