Nvidia supplier SK Hynix posts record quarterly profit on strength of AI boom

South Korea’s SK Hynix, one of many largest reminiscence chipmakers on the earth, posted report quarterly earnings Thursday on the again of robust gross sales of excessive bandwidth reminiscence utilized in generative AI chipsets.

SK Hynix shares, nevertheless, fell 2.7% as CFO Woo-Hyun Kim warned that the outlook for reminiscence demand in 2025 was clouded by stock changes from PC and smartphone producers in addition to strengthened protecting commerce insurance policies and geopolitical dangers.

Listed here are SK Hynix’s fourth-quarter outcomes in contrast with LSEG SmartEstimate, which is weighted towards forecasts from analysts who’re extra constantly correct:

Income: 19.77 trillion received ($13.7 billion) vs. 19.91 trillion wonOperating revenue: 8.08 trillion received ($5.6 billion) vs. 8.02 trillion received

Income rose about 75% within the October-December quarter in contrast with the identical interval a yr earlier, whereas working revenue surged 2,236% to eight.08 trillion, yr on yr.

On a quarter-on-quarter foundation income was up 12%, whereas working revenue grew 15% to a recent report excessive.

The chipmaker has benefitted from a increase in synthetic intelligence servers and is a key provider to U.S. AI chip designer Nvidia.

“With extended robust demand for AI reminiscence, the corporate achieved [an] all-time excessive outcome by means of world-leading HBM know-how and profitability-oriented operation,” SK Hynix stated in its earnings launch.

HBM is a kind of dynamic random entry reminiscence, or DRAM, by which chips are vertically stacked to avoid wasting house and scale back energy consumption. Micron Know-how and Samsung Electronics are the opposite key gamers the HBM house.

SK Hynix’s robust fourth-quarter numbers conclude a yr that noticed the corporate attain report yearly income, beating the earlier excessive in 2022 by over 21 trillion received. In the meantime, working revenue beat a report set in 2018 throughout a “tremendous increase” within the semiconductor business.

Demand uncertainty in 2025 apart, the corporate forecasts that demand for HBM and different DRAM merchandise will proceed to extend as massive tech corporations hold investing in AI servers and as coaching AI fashions positive aspects extra traction.

The patron marketplace for PC and smartphones outfitted with AI also needs to develop, with gross sales selecting up within the second half of the yr, the corporate stated.

“The Reminiscence business is transitioning from a commodity market pushed by quantity and value to a custom-made market centered on excessive efficiency and prime quality merchandise,” SK Hynix CFO Woo-Hyun Kim stated within the earnings name.

“All in all, this yr, DRAM demand is projected to develop by a mid to excessive teen proportion, whereas NAND demand is predicted to extend by a low teen proportion,” he added.

NAND is one other sort of reminiscence chip that usually works along with DRAM in PCs, servers and smartphones. 

Correction: This text has been revised to replicate up to date quarter-on-quarter progress information after SK Hynix amended its press launch.