SK hynix shares fall 3% as investors weigh impact of Nvidia chief’s departure
Key Facts
SK hynix shares fell 3% in the Nov. 13 session, closing at $131.79, as investors weighed the impact of Nvidia Chief Executive Jensen Huang’s departure, according to a Yonhap report. The report linked the session’s losses to that concern, without attributing them to U.S. export restrictions. The decline coincided with investors tracking demand for memory chips, after the company reported strong quarterly results at the end of October. Delayed U.S. approvals for equipment the company needs in China were the subject of a separate Reuters report published on Nov. 3. This places the session’s pressure in the context of market concerns about Nvidia, while the Dalian issue remains a separate regulatory and investment matter.
Reuters reported on Nov. 3 that U.S. officials had delayed approval for U.S. equipment SK hynix needs to expand production in China. The report said the company had sought licenses for equipment at its plant in Dalian, in northeastern China. The company told Reuters in October that it was installing equipment at the plant in consultation with the U.S. government. The October report said licensing rules allow existing plants to operate, but do not permit capacity expansion or technology upgrades. This restriction ties investment decisions in China to the limits of what licenses allow, while the company is also planning to add production capacity in the United States.
The constraints are reflected in details about Dalian’s products: Reuters reported in October that the plant produces 192-layer NAND memory chips and that the company is authorized to produce chips of up to 240 layers there. By comparison, SK hynix sells NAND chips of up to 321 layers outside China, according to the same report. The gap highlights the limits on technology permitted at the Chinese plant compared with products the company offers in other markets. This comes as the company considers expanding NAND manufacturing in the United States through its Solidigm unit. Reuters reported that the unit plans to invest about $45 billion to build two plants in New York state, with investment potentially reaching about $100 billion over time.
The U.S. expansion plans come as SK hynix reported strong third-quarter results. Revenue totaled 104.6155 trillion won, up 32% from the previous quarter, while operating profit reached 83.3338 trillion won, up 38%, according to results published on Oct. 28. The company also said it had signed long-term supply agreements with 14 major customers, covering more than 50% of its production capacity for 2027 and 2028. The agreements provide visibility for part of future output as the company competes to meet the needs of major customers, including global cloud service providers. These commitments may heighten the importance of decisions on adding capacity and distributing it among manufacturing sites.
SK hynix said in its results that the complexity of advanced manufacturing technologies and the time required to build new facilities could keep demand above supply in the memory market through 2030. In a Reuters report published in October, the company said it had sold all of its HBM and DRAM chip output through 2029, and that demand for HBM was twice what it could supply. These figures provide context for its investment plans in China and New York, as expanding production requires balancing licensing constraints with the ability to meet demand. The company also announced that its shareholder return policy for 2026 would total about 100 trillion won, including cash dividends exceeding 30 trillion won and share buybacks and cancellations exceeding 60 trillion won. The plan combines shareholder returns with capital spending at a time when the company expects tight supply to persist.