SK Hynix has reported 94 percent rise in revenues to 17.5731 trillion won in Q3 2024, an all-time high, surpassing its previous record of 16.4233 trillion won set in Q2 2023.
The growth in revenue was driven by strong demand for high-end memory chips, especially those used in generative AI systems. SK Hynix is one of the key suppliers to Nvidia.
SK Hynix has achieved an operating profit of 7.03 trillion won or $5.07 billion (operating margin: 40 percent) and a net profit of 5.7534 trillion won (net margin: 33 percent), exceeding its previous records from the semiconductor boom of 2018.
SK Hynix said sales of premium products, such as High Bandwidth Memory (HBM) and eSSDs, surged, particularly in AI-related applications. HBM sales grew over 70 percent from the previous quarter and 330 percent year-over-year.
SK Hynix said the average selling price (ASP) for both DRAM and NAND rose by around 10 percent quarter-over-quarter due to high demand for premium products, further driving profits.
SK Hynix forecasts continued strong demand for AI-related memory products, driven by the growth of generative AI and investments in Artificial General Intelligence (AGI) by global tech companies.
Product Strategy:
In DRAM, the company is quickly transitioning from HBM3 to HBM3E products, with HBM sales projected to reach 40 percent of DRAM revenues by Q4.
For NAND, SK Hynix plans to expand high-capacity eSSD sales to meet rising demand.
The company predicts a recovery in demand for PC and mobile products in 2024 as AI-optimized memory solutions are released for various devices.
SK Hynix will continue to focus on high-value-added products and profit optimization, solidifying its position as a leader in AI memory technology.
SK Hynix has outperformed rivals like Samsung and Micron, benefiting from early investments in HBM technology and the surge in demand for AI servers. The company expects this trend to continue in 2025, Reuters news report said.
Samsung has warned that its Q3 profits will fall below expectations due to challenges in penetrating the high-end memory chip market.
SK Hynix has begun production of its HBM3E 12-layer chips, with plans to supply them to customers by the end of the year, positioning itself as a major supplier to Nvidia.
Baburajan Kizhakedath
