SK hynix Q2 net profit jumps 1,242% on AI demand

South Korea's SK hynix said its second-quarter net profit rose 1,242% from a year earlier to 94 trillion won, or $64 billion, as demand from the artificial intelligence industry lifted its memory chip business.

The company said operating profit for April to June rose 557% year on year to 60 trillion won. Revenue reached 79 trillion won.

SK hynix described the figures as “an all-time high quarterly performance”. The company attributed the growth to sustained demand from expanding investments in AI infrastructure, saying more complex AI technology requires more of its high bandwidth memory chips.

“With major tech companies increasing their AI infrastructure investments, additional supply requests continue to mount,” SK hynix said. It said revenue generated from AI services was supporting those investments and that memory demand momentum was expected to continue.

SK hynix supplies Nvidia and has benefited from the global race to build artificial intelligence data centres. Its parent company SK Group announced on Saturday plans for a $500 billion collaboration with Nvidia to invest in AI infrastructure.

Earlier this month, SK hynix raised $26.5 billion through an American Depositary Receipt listing in the United States, described in the supplied information as one of the world's largest-ever equity offerings.

Despite the investment push, SK hynix shares have fallen 33% over the past month, while shares in its larger South Korean rival Samsung Electronics have fallen 41%. SK hynix shares fell 14% on Tuesday, the day before the earnings release.

KB Securities analyst Kim Dong-won said in a Monday note that the fall was caused by concerns about AI industry sustainability and conflict in the Middle East affecting investors.

Kim forecast memory chip prices are likely to rise “at least 30 percent in the third quarter” and said supply shortages are likely to persist through 2028.

Samsung Electronics is due to report quarterly earnings on Thursday. The company has forecast second-quarter operating profit to rise 1,800% from a year earlier.