The SK Hynix logo is displayed on the phone's screen as seen in this illustration taken in Krakow, Poland on January 30, 2023.
Jakub Purzycki | norphoto | Getty Images
South Korea SK HynixAmazon, one of the world's largest memory chip makers, on Thursday reported record quarterly profits, boosted by strong demand for its high-bandwidth memory (HBM) used in generative artificial intelligence.
Here are SK Hynix's third-quarter results compared to LSEG SmartEstimate, which are weighted according to consistently more accurate analyst forecasts:
Revenue: 17.57 trillion won ($12.7 billion) vs. 18.11 trillion won Operating profit: 7.03 trillion won ($5.08 billion) vs. 6.8 trillion won
Operating profit in the July-September quarter reached its highest level, rebounding from a loss of 1.8 trillion won during the same period last year.
Quarterly revenue grew nearly 94% year-on-year from 9.1 trillion won.
The South Korean chip giant is a major supplier to Nvidia and has benefited from the boom in AI servers.
SK Hynix said in its earnings statement Thursday that demand for AI memory, especially from data center customers, continued to be strong in the third quarter, allowing it to expand sales of premium products such as HBM and eSSD, a data storage device for servers.
HBM is a type of dynamic random access memory, commonly known as DRAM, where chips are stacked vertically to save space and reduce power consumption. DRAM is often used in laptops, workstations, and personal computers. SK Hynix, Micron Technology and Samsung Electronics are the three main manufacturers of HBM chips.
Sales of HBM products also increased by more than 70% from the previous quarter and more than tripled from the same period last year, with the company expecting continued growth.
SK Hynix shares
“While demand for memory for AI servers such as HBM and (High Density Enterprise SSD) has increased significantly this year, the company expects this trend to continue next year,” the company said in a press release.
The company added that generative artificial intelligence continues to advance and major technology companies continue to invest to develop the technology.
SK Hynix also forecast that demand from the PC and mobile consumer product markets will be on a steady growth path in the coming year amid the emergence of AI-enhanced devices.
“The memory industry is finally going through a severe downturn and is now entering a full recovery phase,” Kim Woo-Hyun, head of DRAM marketing at SK Hynix, told reporters on an earnings call.
“To respond to next year’s demand, our company plans to expand stable production and support products in which we have a competitive advantage,” she added.
In 2023, the memory market saw a sharp decline due to oversupply, weak end-market demand and geopolitical tensions, according to Fitch Ratings.
The company said last month that it had begun mass production of its latest version of HBM chips and aims to deliver by the end of the year.
SK Hynix shares initially fell 0.4% when markets opened in South Korea on Thursday, before recovering to trade 1.3% higher.
