SK Hynix achieved a record quarterly operating profit of 9.21 trillion won (approximately $7.1 billion) in Q2 2025, marking more than a threefold increase from the same period last year. The stellar performance was driven by robust demand for High Bandwidth Memory (HBM), a crucial component in the artificial intelligence era.
Record-Breaking Revenue and Profitability
According to SK Hynix's July 24 earnings announcement, revenue surged 35% year-over-year to 22.23 trillion won. The operating margin reached an impressive 41.4%, placing the company among the most profitable in the semiconductor industry.
Notably, net profit exceeded 6 trillion won, demonstrating SK Hynix's firm leadership in the AI memory market. The company attributed the strong performance to "the full-scale mass production and expanded sales of next-generation HBM3E 12-layer products."
HBM Market Leadership Drives Success
SK Hynix's exceptional results stem from its dominant position in the HBM market. The company currently commands over 50% of the global HBM market share, with nearly 90% share in the latest HBM3E products.
HBM is essential for AI training and inference, with explosive demand from major AI chip manufacturers like Nvidia. SK Hynix has already sold out its entire 2025 HBM production capacity, with pre-orders reportedly extending into 2026.
Bright Outlook: Q3 Operating Profit Expected to Exceed 10 Trillion Won
Securities analysts project SK Hynix's Q3 operating profit will surpass 10 trillion won. According to consensus estimates compiled by Yonhap Infomax, Q3 operating profit is expected to reach 10.26 trillion won, representing a 45.94% year-over-year increase.
This optimistic outlook is based on the expanding supply of HBM3E 12-layer products. HBM3E commands prices more than double those of conventional HBM3, with operating margins exceeding 60%. SK Hynix plans to increase HBM3E's share to over 70% of total HBM sales in the second half.
Widening Gap with Samsung Electronics
The earnings announcement further widened the memory semiconductor gap between SK Hynix and Samsung Electronics. With Samsung's Q2 memory division operating profit estimated at around 4 trillion won, SK Hynix recorded more than double the profitability.
Industry experts note that "technological differences in the HBM market are translating into earnings gaps," adding that "SK Hynix's 6-month lead in HBM3E mass production will sustain this gap for the foreseeable future."
Strengthening Partnerships with US Big Tech
SK Hynix is deepening collaborations with major tech companies including Nvidia, Google, Meta, and Microsoft. Recently, Elon Musk's Tesla and xAI are reportedly considering SK Hynix HBM purchases.
A company representative stated, "As AI models grow larger, HBM demand is increasing exponentially. The HBM market is expected to grow at an average annual rate of over 60% through 2026."
Employees Share in Success with Record Bonuses
SK Hynix plans to reward employees with exceptional performance bonuses following the record earnings. The company will reportedly pay first-half bonuses exceeding 300% of base salary, more than double the year-ago level.
The company also plans to raise entry-level salaries to industry-leading levels and significantly expand welfare benefits to secure top talent, recognizing that AI memory technology competition is fundamentally a talent competition.
Expanding Investment for Sustainable Growth
SK Hynix plans to further expand investments for future growth based on these results. The company increased its 2025 capital expenditure by 20% from initial plans to 20 trillion won, with over half dedicated to HBM production capacity expansion.
The new fab under construction in Yongin, Gyeonggi Province, will be built as a dedicated HBM production line targeting mass production by 2027. The company is also considering an HBM packaging facility in Indiana, USA.
Strategy for Intensifying Competition
Competition is expected to intensify as rivals like Samsung Electronics and Micron accelerate their HBM market entry. However, SK Hynix remains confident in maintaining market leadership based on its technological edge and customer trust.
SK Hynix President Kwak Noh-jung emphasized, "HBM is not just memory but a customized solution. Our core competitiveness lies in developing differentiated products through close customer collaboration."
SK Hynix is poised to continue its innovation and growth trajectory as a leading memory semiconductor company in the AI era.
Original article: https://trendy.storydot.kr/economy/sk-hynix-q2-earnings-record-high-hbm-demand
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