SK Hynix reported a record operating profit of 60.54 trillion won for the second quarter of 2026, driven by soaring AI infrastructure demand. However, the figures missed analyst expectations, triggering a sharp 13% decline in shares as investors weighed long-term supply deals against lofty artificial intelligence growth forecasts.
South Korean memory-chip manufacturer SK Hynix posted staggering financial gains for the April–June period, yet the results failed to satisfy Wall Street’s supercharged expectations. The company recorded revenue of 79.32 trillion won and an operating profit of 60.54 trillion won, representing a massive year-on-year surge of nearly 557%, according to CNBC. For the first time in corporate history, cumulative revenue for the first half of the year surpassed 100 trillion won.
Despite hitting these record highs, the headline numbers fell short of consensus estimates compiled by LSEG SmartEstimates, which had anticipated an operating profit of 64 trillion won and revenue of 84 trillion won, as reported by Reuters. That earnings miss, combined with growing anxiety over the sustainability of aggressive artificial intelligence spending by major technology corporations, sent SK Hynix shares tumbling 13% in a single trading session.
Pricing Power, Gross Margins, and the HBM Dynamic
Market analysts note that the company’s gross margin remained robust at over 80% for the June quarter, signaling that foundational pricing power remains intact across the memory sector. Josh Gilbert, lead analyst for APAC at eToro, observed that such profitability doesn’t exist in a market where demand is drying up; it exists in one where customers are fighting over supply
as quoted by CNBC.
At the same time, SK Hynix faced a unique structural headwind. As chosun.com reported, the company’s revenue mix has a heavier concentration in high-bandwidth memory (HBM) accelerators designed for artificial intelligence workloads compared to its domestic rival. While general dynamic random-access memory (DRAM) and NAND flash prices surged significantly, HBM pricing gains grew at a more modest pace.
Furthermore, sequential price increases slowed during the second quarter. SK Hynix management noted that standard DRAM prices rose by about 30% and NAND flash by the mid-50% range over the previous quarter, cooling down from the even sharper advances of 60% to 70% recorded in the first quarter.
Securing Long-Term Supply Deals Amid Surging Capital Expenditure
To hedge against the historical volatility of semiconductor demand cycles, SK Hynix has actively pursued long-term supply agreements. According to Reuters, the company has finalized roughly 10 multiyear contracts spanning about five years, complete with financial safeguards such as customer deposits.
While these agreements cement long-term revenue visibility, analysts pointed out that fixed pricing terms may temper near-term price gains. Nevertheless, executive leadership defended the strategy during an earnings call, emphasizing that demand from major cloud service providers and hyperscalers remains robust. Company President Song Hyun-jong stated that major customers are still requesting more memory supply
as cited by Reuters.
“With major tech companies increasing their AI infrastructure investments, additional supply requests continue to mount. As these investments are supported by revenue generated from AI services, the momentum in memory demand is expected to persist.”
SK Hynix management, via Reuters
Backing this bullish outlook on future demand, SK Hynix raised its capital expenditure target for the year to the high-40 trillion won range—translating to roughly $31 billion—up from 30.2 trillion won in 2025.
Shareholder Return Pressures and Market Sentiment
Market participants have pressed management to outline clear mechanisms for distributing the windfall of the artificial intelligence boom.
Analysts note that the absence of detailed shareholder return plans has weighed on investor sentiment alongside broader macroeconomic jitters. SK Hynix indicated it plans to provide further details regarding its shareholder return framework later in the year.
Looking toward the second half of 2026, the company expects production of its advanced HBM4 chips to ramp up significantly. With mass shipments beginning and sample shipments of HBM4E completed during the first half, leadership aims to maximize domestic output across its manufacturing hubs in Icheon, Yongin, and Cheongju to meet enduring industry needs.