Seoul: SK hynix Inc. announced on Thursday that its first-quarter net profit has more than quadrupled due to a surge in demand for artificial intelligence (AI) chips, including high bandwidth memory (HBM), surpassing market expectations. The world's second-largest memory chipmaker reported a net income of 8.1 trillion won (US$5.7 billion) for the January-March period, a significant rise from 1.92 trillion won a year earlier.
According to Yonhap News Agency, SK hynix's operating income soared by 157.8 percent year-on-year to 7.44 trillion won for the quarter, compared to 2.88 trillion won in the previous year. Revenue rose by 41.9 percent, reaching 17.63 trillion won. These figures mark the second-best quarterly results following record highs in the fourth quarter of last year. Analysts had estimated an average net profit of 5.48 trillion won, but SK hynix exceeded these expectations, attributing the strong performance to the rising demand for AI memory, which has solidified its global leadership in HBM technology.
The company highlighted that the memory market accelerated faster than anticipated due to increased competition in AI systems development and inventory accumulation demand. SK hynix's quarterly operating profit is projected to surpass that of its competitor, Samsung Electronics Co., which reported 6.6 trillion won in operating profit for the first quarter. This is the second consecutive time SK hynix has outperformed Samsung Electronics in operating profit, following the fourth quarter of last year.
Looking ahead, SK hynix expects its annual HBM sales for 2025 to double from those of 2024, with sales orders for 2025 already secured. CEO Kwak Noh-jung noted that the company has sold out its current year's HBM production, supplying its advanced 12-layer HBM3E product to major customers, including Nvidia Corp. The 12-layer HBM3E, which is currently the most advanced HBM in mass production, is anticipated to account for more than half of its total HBM3E sales in the second quarter.
Furthermore, SK hynix plans to prepare for the mass production of its sixth-generation HBM4 chips by the end of the year. CFO Kim Woo-hyun stated that the company will focus on products that ensure demand feasibility and profitability to enhance investment efficiency. As a leader in AI memory, SK hynix aims to strengthen collaborations with partners and pursue technological innovations to maintain profit growth and industry-leading competitiveness.
Despite the positive earnings, SK hynix acknowledged the potential impact of unpredictable U.S. tariff policies on its operations. Although the U.S. government recently imposed baseline and country-specific reciprocal tariffs, imported semiconductors are currently exempt. However, President Donald Trump has indicated that new tariffs on chips may be introduced soon. SK hynix assured that it would respond accordingly once an official announcement is made, maintaining close communication with customers to ensure a stable supply.
The company's stock fell by 1.16 percent to 178,900 won as of 10:45 a.m., underperforming the broader KOSPI's 0.51 percent decline. SK hynix released its earnings report before the market opened.