SK hynix Q2 Earnings Call Highlights

Record Q2 performance: Revenue rose 51% sequentially to KRW 79.3 trillion, while operating income jumped 61% to KRW 60.5 trillion, driven by higher DRAM and NAND pricing and strong AI-related demand. The figures remain provisional pending external auditor review. AI demand is sustaining tight supply: HBM, server DRAM and enterprise SSD demand drove significant shipment and pricing gains, and management expects DRAM demand to grow in the mid-20% range and NAND demand in the high-teens despite ongoing supply constraints. Capacity and product expansion: SK hynix began mass-production shipments of HBM4 and plans a broader second-half ramp, while accelerating M15X, Yongin, advanced packaging and NAND investments. Capital expenditures for 2026 are expected to reach the high-KRW 40 trillion range. SK hynix NASDAQ: SKHY reported record second-quarter results for 2026, citing continued AI infrastructure investment, tight memory supply and higher pricing for DRAM and NAND products. President of Corporate Center Song Hyeon-jong said consolidated revenue rose 51% from the prior quarter and 257% from a year earlier to KRW 79.3 trillion. Operating income increased 61% sequentially and 557% year over year to KRW 60.5 trillion, while operating margin rose five percentage points from the first quarter to 76%. Get SK hynix alerts: Sign Up MarketBeat Week in Review – 07/13- 07/17 The company cautioned that its reported figures are provisional because its external auditor’s review has not been completed. AI Memory and Enterprise SSD Demand Drive Growth Song said demand for AI-related memory products, including high-bandwidth memory, server DRAM and enterprise solid-state drives, supported price increases across both major business lines. The SK Hynix IPO and 2027’s AI Memory Squeeze DRAM bit shipments rose by a high-single-digit percentage in the quarter, led by HBM3E and AI server DRAM products. Average selling prices for DRAM climbed about 30%, supported by continued strength in conventional DRAM pricing. The company also cited significant sales growth for server LPDDR products, including SOCAMM2. In NAND, bit shipments rose by a mid-teens percentage from a reduced first-quarter base, with enterprise SSD sales expanding. Enterprise SSD revenue doubled from the previous quarter, while Solidigm revenue from high-capacity enterprise SSDs of 30 terabytes and above increased more than threefold, according to Song. NAND average selling prices increased by a mid-50% percentage due to pricing strength across products. Second-quarter depreciation and amortization totaled KRW 4 trillion, while EBITDA was KRW 64.6 trillion and EBITDA margin was 81%. The company reported KRW 62.2 trillion in net non-operating profit, including KRW 1.1 trillion in foreign-exchange-related net gains and KRW 63.3 trillion from sales and valuation gains on investment assets. Net profit was KRW 93.9 trillion. Cash and cash equivalents, including short-term investments, reached KRW 88 trillion at quarter-end, up KRW 33.6 trillion from the end of the first quarter. Interest-bearing debt fell KRW 0.7 trillion to KRW 18.6 trillion, leaving net cash of KRW 69.4 trillion. The debt-to-equity ratio improved to 7%. Supply Constraints Expected to Continue Management said AI is broadening memory demand beyond HBM as agentic AI services require more server DRAM and generate additional demand for high-performance enterprise SSDs. Song said the company expects DRAM demand to grow in the mid-20% range and NAND demand to grow in the high-teens percentage range amid constrained supply conditions. He said supply-demand balance is unlikely to improve meaningfully in the near term because of the complexity of advanced processes us...