SK hynix Achieves Quarterly Profit Milestone Over Samsung
Synopsis
For the first time, SK hynix has exceeded Samsung Electronics in quarterly profits, driven by strong AI memory chip sales. The company's quarterly operating profit reached a record high of 8.08 trillion won, showcasing its competitive edge in the HBM market amidst the generative AI boom.
Key Takeaways
SK hynix achieved a record operating profit of 8.08 trillion won.
This marks the first time SK hynix surpassed Samsung Electronics in quarterly profit.
Strong demand for AI memory chips fueled performance.
HBM sales constituted over 40% of DRAM sales in Q4.
Samsung's HBM has not yet penetrated the global market.
Seoul, Jan 28 (NationPress) The chipmaking powerhouse SK hynix has, for the first time, outperformed its main competitor, Samsung Electronics, in quarterly profit, according to data released on Tuesday. This achievement is driven by strong sales of artificial intelligence (AI) memory chips, which propelled its fourth-quarter results to unprecedented levels.
In its quarterly earnings report, SK hynix reported an impressive 8.08 trillion won (approximately $5.62 billion) in operating profit for the October-December timeframe, marking a 15 percent increase compared to the previous year.
In contrast, Samsung Electronics anticipates its fourth-quarter operating profit to be around 6.5 trillion won, which includes approximately 3 trillion won from its semiconductor sector. The tech giant has yet to finalize its earnings figures, as reported by the Yonhap news agency.
This milestone signifies the first occasion on which SK hynix has eclipsed Samsung Electronics, a company with a diversified portfolio that includes home appliances, mobile devices, and semiconductors, in terms of quarterly operating profit.
For the full year of 2024, SK hynix's total annual operating profit reached a record 23.47 trillion won, whereas Samsung Electronics' chip sector is projected to generate about 15 trillion won.
The remarkable performance of SK hynix was fueled by a robust demand for premium high bandwidth memory (HBM) chips, particularly amid the generative AI surge, even as the demand for traditional memory chips used in smartphones and personal computers remains weak.
Since commencing its supply of HBM to Nvidia Corp., which is vital for AI computing with its graphic processing units (GPUs), SK hynix has established a stronghold in the HBM market.
During the fourth quarter, HBM sales constituted more than 40 percent of the company's DRAM sales, an increase from 30 percent in the preceding quarter.
Ryu Young-ho, an analyst at NH Investment & Securities Co., remarked, "SK hynix boasts a portfolio of higher value-added products compared to its competitors, rendering it less vulnerable to market downturns."
Meanwhile, Samsung Electronics, recognized as the world's leading memory chipmaker, has faced challenges in enhancing its profit due to the delayed global market introduction of its HBM.
Currently, SK hynix supplies nearly all its HBM to Nvidia and is anticipated to retain its dominance in the HBM market for the foreseeable future.
