SK Hynix Sees Memory Shortage Lasting Until 2030 as Quarterly Profit Surges
Key Facts
SK Hynix expects demand to continue exceeding supply in the memory market through 2030, citing the difficulty of advanced manufacturing technologies and the time required to build new production facilities. The company announced the forecast on October 28, alongside third-quarter 2026 results that showed strong growth in revenue and profit. In its statement, it said that “demand exceeding supply” would remain the market’s prevailing structure through that horizon. The forecast puts supply pressures in a multi-year context as the company continues to expand production capacity and meet demand from customers seeking AI-related memory. The quarterly results show the scale of current activity, while the company’s outlook and supply agreements point to the demand it expects to serve in the coming years.
The company’s revenue reached 104.6155 trillion won in the third quarter of 2026, surpassing 100 trillion won for the first time. Revenue rose 32% from the second quarter and 328% year over year from the third quarter of 2025. Operating profit reached 83.3338 trillion won, up 38% from the previous quarter and 632% from the same period last year. The operating margin reached 80% during the quarter. According to Reuters, operating profit exceeded the 76.7 trillion won estimate from LSEG SmartEstimate, compared with reported profit of 83.3 trillion won for July through September.
SK Hynix attributed the results’ growth to higher prices for its main products amid rising demand for AI memory. It said shipments of fourth-generation high-bandwidth memory had begun on a large scale, as this type of memory becomes increasingly important to meeting the demand the company has described. Reuters reported that demand for high-bandwidth memory was twice the volume the company could supply. The report added that the company had presold high-bandwidth memory chips and dynamic random-access memory through 2029. That time horizon illustrates the scale of existing commitments, alongside the company’s expectation that demand will remain above supply through 2030.
The company said it had signed long-term supply agreements with 14 major customers, including global cloud service providers. Contracted volumes to date cover more than 50% of total production capacity for 2027 and 2028. The agreements typically run for five years, according to the company, which said it was discussing extensions with some customers. These agreements tie a significant share of future capacity to specific orders before additional investments and production facilities come online. Securing these volumes comes as the company says building new capacity takes a long time and the difficulty of advanced manufacturing limits how quickly supply-demand imbalances can be addressed.
In early Korean trading on October 28, SK Hynix shares rose 7% to a two-week high, according to the Associated Press, following the results announcement. Samsung Electronics shares climbed 8.5% in early trading ahead of its quarterly results, scheduled for Thursday, October 29. The KOSPI rose 5.6% in the early session, as Asian stocks broadly gained. U.S. closing data available through October 27 showed SK Hynix’s U.S.-listed shares closing at $145.36. Lam Research, Applied Materials and KLA shares closed at $240.85, $395.93 and $153.66, respectively; those prices alone do not establish the direction or cause of the move.
SK Hynix expects a significant increase in investment next year as the first phase of its Yongin project reaches full operation and infrastructure investment accelerates at home and abroad. The company said the scale and timing of spending would remain flexible, depending on demand, profitability and investment efficiency. On production, the company plans to ramp its M15X plant to full capacity by the end of 2026 to increase output of fourth-generation high-bandwidth memory. It expects this generation to surpass its predecessor in shipment volume and revenue in the fourth quarter of 2026, becoming its main product. That puts shipment and investment developments at the center of the next phase, as the company’s forecast of a continuing market shortage extends through 2030.