Quick overview
- SK hynix ADR is trading near $161, down about 2% from yesterday’s close after a 13.30% surge on Wednesday.
- The company reported record revenue of KRW 104.62 trillion, up 328% year-over-year, with an operating profit margin of 80%.
- SK hynix plans to return KRW 100 trillion to shareholders by 2026, including over KRW 30 trillion in dividends, despite missing net profit forecasts.
- Investors are closely monitoring memory pricing and demand, with key support at $156.50 and resistance at $166.06.
SK hynix ADR (SKHY) is trading near $161 in the pre-market hours, down about -2% from yesterday’s close at $164.70. The stock surged +13.30% on Wednesday with trading volume of about 49 million shares, which was more than double the average.
A Record Quarter Resets the AI Memory Debate
Lately investors had been concerned that AI spending was peaking, which kept memory stocks under pressure. However, this week, SK hynix reported revenue of KRW 104.62 trillion, up 328% from previous year. Its operating profit had 80% margin as it reached KRW 83.33 trillion against consensus estimate of KRW 76.72 trillion.
SK hynix supplies high-bandwidth memory used in AI accelerators. The strong margin shows the company still has pricing power.
This raises the question of how long this pricing power will last. Management has said that DRAM and HBM capacity is effectively sold out through 2029, with tight supply potentially continuing through 2030. Long-term agreements now cover more than half of its 2027 and 2028 capacity.
A KRW 100 Trillion Payout Changes the Equity Story
SK hynix plans about KRW 100 trillion in shareholder returns for 2026, which includes more than KRW 30 trillion in dividends. The company ended the quarter with net cash of KRW 98.7 trillion. This could support investor confidence but as its net profit missed forecasts, it made the shareholder payout an important part of the market reaction.
Meanwhile, Samsung fell about 4% in Seoul after reporting record profit but providing no update on shareholder returns and slightly missing expectations for its chip business. In response, SK hynix rose 2.6% in Seoul as investors responded to its clear payout plan.
Alphabet and Microsoft Show Where the AI Money Goes
Meanwhile, the AI bubble concerns came infront again after Alphabet reported negative free cash flow and its stock fell more than 10%. On the other hand, Microsoft reported strong quarterly results and surged in response. Both companies spent about $9 Billion less on capex than expected because supply arrived late. This indirectly supported SK hynix’s outlook, as spending was held back by limited supply rather than weak demand.
Analyst Targets and What to Watch Next
At around 10.5 times trailing earnings, the stock’s valuation depends on whether current earnings and pricing power can last through the cycle. Initial support starts at $156.50 level, while resistance sits at $166.06 level, followed by the 50-day average near $169 and the $173 level.
Investors will also watch SanDisk’s earnings tonight and Amazon’s report for further signals on memory pricing and AI spending. On technical ground, holding $156.50 could keep the earnings gap intact. Any close above $169 level will target $173 level. And any close below $145.36 level would erase the entire move.
Today’s FXLeaders Live Session
Wednesday’s FXLeaders live session covered gold, oil and the US dollar index key levels on Fed decision day.
FAQs
Why did SK hynix stock rise on Wednesday?
SK hynix shares surged after the company reported record revenue, strong operating profit, and an 80% operating margin, beating analysts’ expectations.
Bottom Line:
SK hynix’s record earnings and shareholder payout plan supported the rally. However, investors will watch whether strong memory demand and pricing power continue through 2029. Traders will watch $156.50 as support and $166.06 as resistance, with a close above $169 potentially opening the way toward $173.
Arslan Ali Butt
Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)
Arslan Ali Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.
His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.
His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
