Nvidia provider SK Hynix posts document quarterly revenue on energy of AI increase

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

SK Hynix shares, nevertheless, fell 2.7% as CFO Kim Woohyun 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 persistently correct:

• Income: 19.77 trillion gained ($13.7 billion) vs. 19.91 trillion gained
• Working revenue: 8.08 trillion gained ($5.6 billion) vs. 8.02 trillion gained

Income rose about 75% within the October-December quarter in contrast with the identical interval a 12 months earlier, whereas working revenue surged 2,236% to eight.08 trillion, 12 months on 12 months.

On a quarter-on-quarter foundation income was up 12%, whereas working revenue grew 15% to a contemporary document 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 sturdy demand for AI reminiscence, the corporate achieved [an] all-time excessive outcome via world-leading HBM expertise and profitability-oriented operation,” SK Hynix stated in its earnings launch.

HBM is a sort of dynamic random entry reminiscence, or DRAM, during which chips are vertically stacked to save lots of area and cut back energy consumption. Micron Know-how and Samsung Electronics are the opposite key gamers the HBM area.

SK Hynix’s sturdy fourth-quarter numbers conclude a 12 months that noticed the corporate attain document yearly income, beating the earlier excessive in 2022 by over 21 trillion gained. In the meantime, working revenue beat a document set in 2018 throughout a “tremendous increase” within the semiconductor business.

In the course of the earnings name, SK Hynix administration stated that the corporate might see a “slight enhance” in capital expenditure in 2025 in contrast with the prior 12 months.

Demand uncertainty in 2025 apart, the corporate forecasts that gross sales progress of HBM and different DRAM merchandise will proceed as giant tech corporations hold investing in AI servers and as coaching AI fashions features extra traction.

The buyer marketplace for PC and smartphones outfitted with AI must also develop, with gross sales choosing up within the second half of the 12 months, the corporate stated.

“The Reminiscence business is transitioning from a commodity market pushed by quantity and value to a custom-made market targeted on excessive efficiency and top quality merchandise,” Kim stated within the earnings name.

“All in all, this 12 months, 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 kind of reminiscence chip that always works along with DRAM in PCs, servers and smartphones. 

Chatting with CNBC’s “Avenue Indicators Asia” Thursday, SK Kim, analyst at Daiwa Capital Markets, stated SK Hynix’s fourth-quarter earnings had been “fairly strong,” however famous that buyers could also be involved concerning the market coming into an adjustment interval. He added that SK Hynix will preserve a management place in HBM.  

SK Hynix’s shares have gained 29% thus far this 12 months, in accordance with LSEG knowledge.

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