SK Hynix surpasses Samsung with record-high profit in Q4

SK Hynix Inc., the top supplier of high-bandwidth memory (HBM) chips to Nvidia Corp., on Thursday reported its highest-ever quarterly profit of 8.08 trillion won ($5.6 billion) for the fourth quarter of 2024, surpassing its bigger rival Samsung Electronics Co. in terms of overall earnings for the first time.

It presented an upbeat outlook as the generative AI boom has driven the semiconductor industry’s transition toward high-performance, high-capacity memory products.

The world's No. 2 memory chipmaker forecasts 12-layer HBM3E to account for more than half its HBM3E shipments in the first half of this year. The 12-layer HBM3E is currently the most advanced AI chip for mass production. It began supplying them to Nvidia late last year.

Operating profits at SK Hynix's operating profit marked a 15.0% rise in the fourth quarter from the third and a whopping 23-fold surge from the year prior on a preliminary basis, according to its regulatory filing.

Revenue in the October-December quarter jumped 12.5% on-quarter to 19.77 trillion won, a 74.8% on-year surge. The results came in line with market expectations. 

The stellar performance exceeded that of rival Samsung Electronics, which reported 6.50 trillion won in operating profit during the same period. Its sales are about one-fourth of Samsung’s.

Samsung's weaker-than-expected results were blamed on soft demand for conventional memory chips for PC and mobile devices, coupled with disappointing sales of smartphones and other mobile devices.

For all of 2024, SK Hynix made a turnaround with an operating profit of 23.47 trillion won from a loss of 7.73 trillion won the year prior.

Its revenue doubled to 66.19 trillion won from the previous year with HBM sales up 4.5-fold.

The South Korean chipmaker has been at the forefront of developing HBM, so-called AI chips, outpacing Samsung Electronics in the sector.

At CES 2025 this month, it unveiled its 16-layer HBM3E, an upgrade over 12-layer HBM3E and the latest advancement in HBM technology.

In the second half of this year, SK Hynix plans to showcase a sixth-generation HBM: 12-layer HBM4.

On Thursday afternoon, its share price dipped 1.11% to 223,000 won in line with the rangebound Kospi market. Investors capitalized on its recent gains as the stock has jumped 31% year-to-date.

Its cash and cash equivalents soared 58% to 14.2 trillion won at the end of 2024 from the year prior. Liabilities shrank by about a quarter to 22.7 trillion won.

It decided to raise the annual dividend payment by a quarter to 1,500 won per share for a total of 1 trillion won.

Buoyed by the strong earnings, SK Hynix will pay handsome bonuses to employees this month, nearly 1.5 times their annual salaries. 

(Updated with SK Hynix's comments and other details)

Write to Yeonhee Kim at yhkim@hankyung.com

Jennifer Nicholson-Breen edited this article.