SK hynix pledges to return $75 bil. to shareholders

By Nam Hyun-woo

• Published Oct 28, 2026 8:33 AM KST
• Updated Oct 28, 2026 3:49 PM KST

Chipmaker logs $62.8 bil. in Q3 operating profit

SK hynix on Wednesday announced a 100 trillion won ($75 billion) shareholder return plan for this year, in order to address the mismatch between its sluggish share price and record-breaking earnings performance.

The decision was announced as the company's revenue and operating profit for the third quarter recorded 104.6 trillion won and 83.33 trillion won, up 328 percent and 632 percent year-on-year, respectively.

During its third-quarter earnings call, the company said it plans to return 100 trillion won to shareholders, including at least 30 trillion won in cash dividends and more than 60 trillion won through share buybacks and cancellations.

“We believe our shares are undervalued, as their current price does not fully reflect the profits and cash flow the company is generating," the company said.

"Under these circumstances, we believe repurchasing and canceling our shares is an effective way to increase value per share."

It said it would continue repurchasing shares every quarter within its annual buyback plan and the board would determine the size of quarterly repurchases.

The plan includes the recently completed 40 trillion won share buyback program, with the repurchased shares scheduled to be canceled soon. At a board meeting on Wednesday, the company also approved 14 trillion won in cash dividends for the third quarter — 20,000 won per share — and an additional 20 trillion won in share buybacks.

Of the buyback amount, 10 trillion won will be used to repurchase and cancel shares, while the remaining 10 trillion won will be used for employee compensation and will not be counted in the shareholder return plan.

The plan came as SK hynix shares have remained sluggish despite the company repeatedly posting record-breaking earnings.

During Wednesday’s earnings call, the company said its revenue and operating profit for the July-September period stood at 104.6 trillion won and 83.33 trillion won, 328 percent and 632 percent year-on-year rises, respectively. It was the first time the company's quarterly revenue surpassed 100 trillion won, and its operating profit margin reached a whopping 80 percent.

Despite the record earnings, SK hynix shares declined 18.8 percent from 1,693,000 won on Sept. 1 to 1,374,000 won on Tuesday. Investors have questioned whether demand for memory chips will remain strong amid concerns that artificial intelligence (AI)-related investments by global tech giants may have already peaked. The company's now-abandoned attempt to list its subsidiary Solidigm also weighed on its share price.

“Solidigm has been reviewing various ways to secure financial resources for new facilities and other investments needed for growth, and we expected an initial public offering (IPO) would ease its investment burden and expand its financial capacity,” SK hynix CEO Kwak Noh-jung said during the call, explaining the decision announced Friday to scrap the listing plan.

“However, after considering recent volatility in financial markets and semiconductor stocks, we concluded that an IPO at this point would not deliver the benefits we had originally expected,” he said.

As the company demonstrated its commitment to boosting shareholder value, SK hynix shares gained for four consecutive trading sessions through Wednesday. The stock rose 3.3 percent on Friday, when the cancellation of Solidigm's IPO plan was announced, before surging 10.89 percent on Wednesday, as investors welcomed the company's shareholder return plan and handsome earnings that exceeded brokerage consensus estimates.

During the call, the company stressed that demand for memory chips remains strong, saying its high-bandwidth memory (HBM) products for AI accelerators and other DRAM products have already sold out for the next three years through 2029.

"Currently, more than 50 percent of our production capacity for 2027 and 2028 is covered by long-term agreements," the company said.

"Considering the technical complexity of advanced manufacturing processes and the time required to build new production facilities, we expect supply to continue falling short of demand through 2030 … While initial AI investments were concentrated among major tech companies, the investor base is rapidly expanding to include businesses across industries and governments investing in sovereign AI. Even when one group of investors scales back its demand, others are increasing theirs.”

SK hynix said it plans to further advance its manufacturing processes next year. The company will increase the share of its sixth-generation 10-nanometer-class (1c) DRAM process and ramp up production capacity at its M15X plant to full capacity by the end of the year to boost HBM4 output. It expects HBM4 to overtake the previous generation HBM3E in both shipment volume and revenue in the fourth quarter, becoming its main HBM product.