SK hynix reported third-quarter operating profit of 83.3 trillion won, more than seven times the figure for the same period last year, and revenue of 104.6 trillion won, up 328% year over year. Both were records, and its operating margin neared 80%. Its shares rose about 2%. High-bandwidth memory is the high-speed memory used with NVIDIA chips, and the more AI computing capacity expands, the scarcer memory becomes. The company has signed long-term agreements with 14 major customers, locking in more than half its production capacity for 2027 and 2028. Supply is expected to remain tight through 2030, and it has also announced a shareholder-return plan worth about 100 trillion won. When memory prices rise, the biggest winners are the companies selling the shovels. The risk is that if demand shifts, an 80% profit margin could fall just as quickly. The next test for AI computing bills comes with Alphabet and Microsoft’s earnings reports early tomorrow morning.
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