SK Hynix profit rises sevenfold on AI demand as Asian stocks rally

Sevenfold profit jump on AI chip demand

SK Hynix said its operating profit for the third quarter more than sevenfold compared with a year earlier, in results published on Wednesday, 28 October. Revenue rose 328% to 104.6 trillion won, and both figures beat analyst forecasts, which had centred on operating profit of between 76.7 and 81.67 trillion won and revenue of just over 99 trillion won. The operating profit of 83.3 trillion won equals about 56.4 billion euros according to Handelsblatt, while Der Tagesspiegel gave about 56 billion euros and 20 Minuten about 51 billion Swiss francs. The company expects demand for its high-bandwidth memory chips to exceed supply until 2030. Nvidia is among its most important customers, and SK Hynix is the second-largest memory chip producer after Samsung Electronics.

Shareholder payouts and the Kioxia stake

The company plans to return about 100 trillion won to shareholders this year, a sum that includes a 40 trillion won share buyback announced in August. Bloomberg valued that amount at $75 billion. Part of the money for the payouts comes from the sale of SK Hynix's stake in the Japanese competitor Kioxia. The company has not disclosed the financial terms of that sale, but analysts suspect the price was well above the four trillion won it invested in 2018. A South Korean newspaper had reported the plans earlier in the week. According to Handelsblatt, the shares rose about 2% in line with the broader market, while 20 Minuten reported an early gain of 2.7% that later faded. The stock has more than doubled since the end of 2025, although enthusiasm has eased noticeably since mid-year.

Asian markets and the wider AI trade

Asian stock markets rallied on Wednesday on renewed optimism about artificial intelligence. Tagesschau reported that the South Korean Kospi gained 6.6% and Japan's Nikkei 1.2%. Technology stocks on the Nasdaq had already recovered 1.2% the previous evening, helped by financing announcements, including one from Meta Platforms, and the planned stock market listing of the AI developer Anthropic. Maki Sawada, an equity strategist at Nomura Securities, said a pattern is emerging among AI companies: reports of heavy spending have often weighed on share prices, while signs of rising profitability have lifted them. Chris Brigati, investment chief at the financial services firm SWBC, said investors want to know whether heavy AI spending is producing sustainable revenue growth rather than just profit.

Kospi (South Korea)6.6%

Nikkei (Japan)1.2%

Kospi (South Korea)

6.6 %

Nikkei (Japan)

1.2 %

Data from the article text

Europe and the day ahead

Investors in Frankfurt also had strong company results to weigh. The DAX had already gained 0.7% to 25,590 points, according to tagesschau, and was expected to open higher. Deutsche Bank reported after-tax profit of about 1.9 billion euros for July to September, roughly 2% more than a year earlier, and it could now exceed its targeted earnings level of 33 billion euros for the full year. BASF lifted its adjusted operating profit (Ebitda) by 15% to 1.64 billion euros on higher prices and slightly higher volumes, and raised its 2026 guidance to 7.4 to 7.8 billion euros from 6.9 to 7.7 billion. Fund company DWS collected 30.9 billion euros of new money in the quarter, the most it has ever taken in a single quarter, though its earnings growth fell short of analyst expectations. The US Federal Reserve announces its rate decision on Wednesday evening, with a hold between 3.75% and 4% expected after its first hike in about three years in September. Markets are pricing in a further increase in December. Alphabet and Microsoft report their quarterly results after the US close.