SK hynix Announces 3Q24 Financial Results

Rhea-AI Summary

SK hynix reported record-breaking Q3 2024 financial results with revenues of 17.5731 trillion won, operating profit of 7.03 trillion won (40% margin), and net profit of 5.7534 trillion won (33% margin). The company's success was driven by strong AI memory demand, with HBM sales increasing over 70% QoQ and 330% YoY. HBM represented 30% of DRAM revenues in Q3 and is expected to reach 40% in Q4. Both DRAM and NAND average selling prices rose in the mid-10% range compared to the previous quarter.

Positive

• Record quarterly revenue of 17.5731 trillion won, up 7% QoQ and 94% YoY
• Operating profit of 7.03 trillion won with 40% margin, up 29% QoQ
• HBM sales growth of 70% QoQ and 330% YoY
• Mid-10% increase in ASP for both DRAM and NAND
• HBM share of DRAM revenue expected to increase from 30% to 40% in Q4

Negative

• None.

• Revenues at 17.5731 trillion won, operating profit at 7.03 trillion won, net profit at 5.7534 trillion won – all reaching new records
• Achieving best-ever quarterly performance with increasing high value-added product sales based on no.1 AI Memory technology
• Strong demand of memory for AI servers – HBM's share of DRAM revenues in Q3 marks 30% and forecast to be 40% in Q4
• Company to lead the global AI memory market again next year promoting long-term growth by securing both business stability and profitability

SEOUL, South Korea, Oct. 23, 2024 /PRNewswire/ -- SK hynix Inc. (or "the company", www.skhynix.com) announced today that it recorded 17.5731 trillion won in revenues, 7.03 trillion won in operating profit (with an operating margin of 40%), and 5.7534 trillion won in net profit (with a net margin of 33%) in the third quarter this year.

Quarter revenues marked all-time high, exceeding the previous record of 16.4233 trillion won in the second quarter of this year by more than 1 trillion won. Operating profit and net profit also far exceeded the record of 6.4724 trillion won and 4.6922 trillion won in the third quarter of 2018 during the semiconductor super boom.

SK hynix emphasized that the demand for AI memory continued to be strong centered on data center customers, and the company marked its highest revenue since its foundation by expanding sales of premium products such as HBM and eSSD. In particular, HBM sales showed excellent growth, up more than 70% from the previous quarter and more than 330% from the same period last year.

As sales increased mainly on highly profitable premium products, the average selling price (ASP) of both DRAM and NAND rose in the mid 10% range compared to the previous quarter, which made the company mark the highest operating profit.

While the demand of memory for AI servers such as HBM and eSSD has grown noticeably this year, the company predicts that this trend will continue next year. This is because generative AI is developing into a multi-modal¹ form and global big tech companies continue to invest to develop artificial general intelligence (AGI)^2_.

1Multi-modal: AI service that can understand multiple complex information such as text, photos, voice, video, etc.

2Artificial General Intelligence: Artificial intelligence that implements human-like or higher intelligence with a computer

SK hynix also forecasts that the PC and mobile product markets, which had been slow to recover demand compared to memory for AI servers, will be on a steady growth path as well next year as AI memories optimized for each device are released.

As a result, the company will continue to focus on profitability by increasing sales centered on high value-added products based on its world-leading technology in AI memory.

In the DRAM area, SK hynix is continuing the rapid transition from existing HBM3 to HBM3E 8-layer products. The company also plans to start supplying 12-layer HBM3E products, which were mass-produced last month, in the fourth quarter as scheduled. This makes HBM sales, which accounted for 30% of total DRAM revenues in the third quarter, expected to reach 40% in the fourth quarter.

For NAND, the company plans to expand sales of high-capacity eSSD, which is rapidly increasing market demand, while focusing on investment efficiency and production optimization.

"SK hynix has solidified its position as the world's No.1 AI memory company by achieving the highest business performance ever in the third quarter of this year." said Kim Woohyun, Vice President and Chief Financial Officer (CFO) at SK hynix. "We will continue to maximize profitability while securing stable revenues by taking flexible product and supply strategies in line with market demand."

•  3Q24 Financial Results (K-IFRS)

*Unit: Billion KRW
	3Q24	QoQ		YoY
		2Q24	Change	3Q23	Change
Revenues	17,573.1	16,423.3	7 %	9,066.2	94 %
Operating Profit	7,030	5,468.5	29 %	-1,792	Turn to profit
Operating Margin	40 %	33 %	7%p	-20 %	60%p
Net Income	5,753.4	4,120	40 %	-2,184.7	Turn to profit

• Financial information of the earnings is based on K-IFRS
• Please note that the financial results discussed herein are preliminary and speak only as of October 24, 2024. Readers should not assume that this information remains operative at a later time.

About SK hynix Inc.

SK hynix Inc., headquartered in Korea, is the world's top tier semiconductor supplier offering Dynamic Random Access Memory chips ("DRAM"), flash memory chips ("NAND flash") and CMOS Image Sensors ("CIS") for a wide range of distinguished customers globally. The Company's shares are traded on the Korea Exchange, and the Global Depository shares are listed on the Luxemburg Stock Exchange. Further information about SK hynix is available at www.skhynix.com, news.skhynix.com.

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SOURCE SK hynix Inc.

FAQ

What were SK hynix (HXSCL) Q3 2024 revenue and profit figures?

SK hynix reported Q3 2024 revenues of 17.5731 trillion won, operating profit of 7.03 trillion won, and net profit of 5.7534 trillion won.

How much did SK hynix (HXSCL) HBM sales grow in Q3 2024?

SK hynix's HBM sales increased by more than 70% quarter-over-quarter and more than 330% year-over-year in Q3 2024.

What is SK hynix (HXSCL) HBM revenue share forecast for Q4 2024?

SK hynix expects HBM to account for 40% of total DRAM revenues in Q4 2024, up from 30% in Q3.

What was SK hynix (HXSCL) operating margin in Q3 2024?

SK hynix achieved a 40% operating margin in Q3 2024, up 7 percentage points from Q2 2024.