Memory chip giant SK Hynix Q1 profit soars 406% to record high on AI boom

SEOUL - South Korea’s SK Hynix saw a 406 per cent jump in first-quarter operating profit to a record on April 23, as the artificial intelligence boom drove strong demand for both advanced and conventional memory chip products.

The Nvidia supplier reported a 37.6 trillion won (S$32.4 billion) operating profit for the January-March period, up from 7.4 trillion won a year earlier. Quarterly revenue surged 198 per cent to 52.6 trillion won.

The strong results underscore continued momentum in the global memory chip market, as demand from Big Tech companies to build AI data centres has constrained chip supplies and pushed up prices of both high-end and commodity memory chips.

“As AI evolves from large model training to the stage of agentic AI, which repeatedly performs real-time inference across various service environments, the foundation for memory demand is expanding across both DRAM and NAND flash,” SK Hynix said in a statement.

Contract prices for certain DRAM chips jumped nearly 83 per cent in the first quarter from the previous quarter, while prices for some NAND products soared around 160 per cent, according to data from market tracker TrendForce. It expects memory chip prices to rise further in the current quarter, signalling another quarter of robust earnings growth, as AI firms race to secure advanced chips needed for their infrastructure rollouts.

Some analysts expect the pace of price increases to ease after the second quarter, but constrained supply will continue until new production capacity comes online, which can take more than a year after construction begins.

SK Hynix said it expects a favourable pricing environment to continue “for the time being”, as AI-driven demand offsets softer chip demand from PC and smartphone makers. Mr Chey Tae-won, chairman of its parent group SK Group, said in March that the global chip wafer shortage is likely to persist until 2030, as demand driven by AI continues to outpace supply.

SK Hynix said earlier it is accelerating capacity expansion, including bringing forward the opening of a new memory chip plant in South Korea to meet surging demand.

The company said 2026 investment will rise significantly from 2025’s 30.2 trillion won.

It added that it is actively reviewing additional shareholder return measures, including dividends, share buybacks and cancellations, and aims to finalise implementation plans within the year.

Shares in SK Hynix have jumped nearly 90 per cent so far in 2026, with its market value climbing to around US$590 billion (S$752 billion), surpassing chip equipment maker ASML’s US$570 billion, Europe’s most valuable company. REUTERS