Seoul: SK hynix Inc. announced on Thursday that its net profit for the first quarter had more than quadrupled, driven by increasing demand for artificial intelligence (AI) chips, including high bandwidth memory (HBM), surpassing market predictions. The company, recognized as the world's second-largest memory chipmaker, reported in a regulatory filing that its net income for the January-March period reached 8.1 trillion won (US$5.7 billion), a substantial increase from 1.92 trillion won in the same period the previous year.
According to Yonhap News Agency, SK hynix's operating income saw a remarkable 157.8 percent year-on-year growth, reaching 7.44 trillion won for the quarter, compared to 2.88 trillion won a year ago. Revenue also witnessed a significant rise of 41.9 percent, totaling 17.63 trillion won. These figures represent the second-best quarterly results for the company, following the record highs achieved in the fourth quarter of last year.
The earnings not only surpassed market expectations but also outperformed the average net profit estimate of 5.48 trillion won, as per a survey conducted by Yonhap Infomax, the financial data subsidiary of Yonhap News Agency. SK hynix attributed this better-than-expected performance to the strong demand for AI memory, reaffirming its position as a global leader in HBM technology.
"The memory market ramped up faster than expected due to competition to develop AI systems and inventory accumulation demand," SK hynix stated. Looking ahead, the company anticipates that its annual HBM sales for 2025 will double compared to those in 2024, with sales orders for 2025 already secured.
SK hynix's Chief Executive Officer, Kwak Noh-jung, previously disclosed that the company had already sold out this year's HBM production, supplying its 12-layer HBM3E product to major clients, including Nvidia Corp. Sales of the 12-layer HBM3E, currently the most advanced HBM in mass production, are expected to constitute over half of the total HBM3E sales in the second quarter.
For the upcoming sixth-generation HBM4 chips, SK hynix plans to complete preparations for mass production by the year-end. "SK hynix will focus on products with demand feasibility and profitability to enhance investment efficiency," stated Kim Woo-hyun, the company's chief financial officer. "As a leader in AI memory, we will strengthen collaboration with partners and carry out technological innovation to continue profit growth with industry-leading competitiveness."