SK Hynix. [Reuters]
SK Hynix. [Reuters]

SK Hynix extended its record-breaking run in the second quarter, posting operating profit of 60 trillion won ($40.9 billion) and an operating margin exceeding 76%. The second quarter's operating profit alone surpassed the company's full-year operating profit for 2025, which stood at 47.2 trillion won.

For the first half as a whole, sales exceeded 131 trillion won, crossing the 100 trillion won mark for a single half-year period for the first time, while operating profit came close to 100 trillion won. Strong sales of high-value products driven by sustained AI demand underpinned the results, and the company expects momentum to continue into the second half as major big-tech firms ramp up AI infrastructure investment.

SK Hynix said Wednesday it recorded second-quarter sales of 79.32 trillion won and operating profit of 60.54 trillion won, both all-time highs on a quarterly basis.

Sales and operating profit rose 257% and 557%, respectively, from a year earlier. The operating margin reached 76%, while net profit came to 93.92 trillion won, representing a net margin of 118%.

The operating margin was up 4 percentage points from the previous quarter's 72%, setting another all-time high. The figure implies the company retained roughly 7,600 won in profit for every 10,000 won of product sold — a level analysts say is virtually unheard of in manufacturing.

First-half operating profit totaled 98.15 trillion won. However, securities analysts had forecast first-half operating profit would exceed 100 trillion won, and the result fell slightly short of that threshold.

An SK Hynix official said both DRAM and NAND flash prices posted sharp increases in the second quarter, continuing the trend from the previous quarter. "We expanded sales centered on high-value products — including HBM, DRAM for AI servers and enterprise SSDs — to generate record profitability," the official said.

Buoyed by the strong earnings, the company's cash and cash equivalents at the end of the second quarter rose 33.6 trillion won from the end of the previous quarter to 88 trillion won. Over the same period, borrowings fell 700 billion won to 18.6 trillion won, and net cash expanded to 69.4 trillion won.

"Our financial capacity has been significantly strengthened on the back of record-level profit and cash generation," an SK Hynix official said.

On the second-half outlook, the company said "major big-tech companies are expanding their AI infrastructure investment, and additional supply requests are coming in one after another. Since this investment is being made on the basis of revenue generated from AI services, growth in memory chip demand will continue."

The company also said it is broadening discussions with customers on multi-year contracts to secure stable supply over the medium to long term. It has concluded long-term supply agreements with more than 10 customers, including key accounts, and is continuing additional talks with major industry customers. Through these agreements, the company aims to improve operational efficiency while further strengthening medium- to long-term business stability and a foundation for sustainable growth.

"As AI evolves into an agent form that performs complex tasks on behalf of users and spreads across a wider range of services, the base of memory chip demand is broadening significantly," an SK Hynix official said. The company added that a structural shift is underway in which demand for both AI memory and general-purpose memory is expanding together.

The company said it began mass production shipments of HBM4, its sixth-generation high-bandwidth memory, in the second quarter and will ramp up production in earnest in the second half. HBM4E, for which sample supply was completed in the first half, has been produced using an optimized process that ensures technological maturity and stable mass production. In addition, sales of SOCAMM2, a low-power memory module for AI servers, rose sharply in the second quarter, and supply of products using a 10-nanometer-class sixth-generation (1c) process has also begun in full.

For NAND, the company is accelerating the transition to leading-edge processes to strengthen its portfolio around high-capacity, high-performance products. Its 321-layer product already accounts for the largest share of total output, and the company plans to expand that to 50 percent of domestic production capacity by year-end.

To ensure timely supply, the company is moving up the mass production schedule for the Cheongju M15X fab — a new plant for advanced DRAM and HBM production — while also investing to enable rapid capacity expansion following the cleanroom opening of the first Yongin fab in early 2027. Medium- to long-term investment plans, including the advanced packaging plant P&T7, the NAND production facility M17 and the development of a new semiconductor cluster, will be pursued in stages, taking into account customer demand and investment efficiency.

"We plan to prepare for medium- to long-term growth opportunities without disruption while maintaining our capital expenditure principles, strengthening both production capacity and financial soundness," SK Hynix said.


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