Full Breakdown
SK Hynix Posts Record Q3 2026 Earnings, Shares Jump Almost 11%
By Drooid · · How we work
In this breakdown
01
Record Quarterly Performance
SK Hynix reported third-quarter 2026 operating profit of 83.33 trillion won (? $62.1 billion), a 632 % increase from a year earlier and a quarterly record. Revenue rose 328 % year-over-year to 104.62 trillion won (? $78 billion), surpassing the LSEG SmartEstimate of 98.34 trillion won. The operating margin hit 80 %, the highest in the company’s history and above the consensus of 78.4 %. Net income climbed 216 % to $29.65 billion. Compared with the prior quarter, revenue grew 31.9 % and operating profit 37.6 %.
02
Drivers of Growth
- Memory pricing: Average selling prices for DRAM rose by a “high-20 %” and NAND by a “mid-20 %” versus the second quarter.
- Product mix: Higher shipments of high-value HBM4, 1c-nm conventional DRAM, and premium server-grade DDR5 drove ASPs upward. Server DDR5 shipments increased over 40 % sequentially.
- AI demand: Robust AI-related memory demand boosted sales of HBM, server DRAM, and enterprise SSDs.
- Supply constraints: Tight supply, stemming from complex manufacturing processes, supported price strength.
03
Capital Expenditure and Outlook
SK Hynix said it expects capex to reach the high-KRW 40 trillion range in 2026, funding accelerated production at M15X, capacity development at Yongin Fab 1, and new facilities such as P&T7 and M17. The company highlighted a planned HBM4 production ramp-up in the latter half of the year, aiming to sustain growth despite the “higher-for-longer” memory upcycle. Management offered no margin guidance for the quarter, noting that future upside depends on execution rather than new catalysts.
04
Shareholder Returns
The firm announced a total payout of about 100 trillion won (? $75 billion) for the year, comprising:
- Cash dividends of at least 30 trillion won (? $22.4 billion).
- Share buybacks and cancellations of at least 60 trillion won (? $44.7 billion), including a 40 trillion won buyback completed in August.
- A special dividend of $7.45 per share derived from gains on its investment in Japanese chipmaker Kioxia.
05
Official Statements & Responses
SK Hynix’s chief executive, Kwak Noh-Jung, explained that the special dividend reflects the company’s intention to pass the realized gains from the Kioxia investment back to shareholders. He also noted that the firm has halted its review of a possible IPO and pre-IPO fundraising for its U.S. subsidiary Solidigm, citing market volatility and a correction in chip-stock valuations.
06
Verbatim Quotes
- “We intend to return the gains realized from our investment in Kioxia this year to our shareholders through a special dividend,” — CEO Kwak Noh-Jung
07
What’s Next
- SK Hynix aims to return more than 50 % of cumulative free cash flow generated from 2025 to 2027 to shareholders, with Citi forecasting about $26.09 billion in returns for the fourth quarter (? $11.18 billion in buybacks and $14.91 billion in dividends).
- The company plans to continue expanding its HBM4 output and to strengthen its position in the server-memory market, while monitoring potential oversupply risks from industry-wide capacity additions.