SK Hynix announces $75 billion shareholder returns after quarterly profit rises seven-fold

SEOUL: South Korean chipmaker SK Hynix announced shareholder returns of about $75 billion on Wednesday, after reporting a more than seven-fold rise in quarterly profit, according to Reuters.

The company said demand from artificial intelligence (AI) infrastructure continues to push up memory chip prices.

SK Hynix reported record operating profit of 83.3 trillion won for July-September. In the same period a year earlier, it was 11.4 trillion won. The LSEG SmartEstimate, which is weighted toward analysts who are more consistently accurate, had put the figure at 76.7 trillion won.

The company said its shareholder return policy for this year will comprise cash dividends of 30 trillion won ($22.62 billion). It will also carry out share repurchases and cancellations worth 60 trillion won. This includes 40 trillion won announced in August.

SK Hynix, a supplier to Nvidia, said it has sold out of its DRAM and HBM chips until 2029. It is expanding long-term supply deals with major customers.

The company said it has signed long-term agreements with 14 major customers. These are meant to improve demand visibility over the mid to long term.

It added that it is "proactively discussing with a number of customers the possibility of extending the contract terms, which are typically five years."

"The LTA volume secured to date corresponds to more than 50% of total production capacity for 2027 and 2028," the company said.

SK Hynix also reiterated that a chip shortage is likely to continue through 2030. The statement underscored demand for its products. It also addressed market concern about the durability of income from AI.

Shares of SK Hynix were up 5.18 per cent in the latest market data cited. Its last close was 1,341,000 won.