[Conference Call] SK Hynix Confident in Achieving 100 Trillion Won Net Cash and Expanding Shareholder Returns (Comprehensive)

Plans for Mass Production of 'HBM4E' in 2027 Announced

"Expansion of LTAs to Reduce Industry Volatility"

Share Buybacks and Cancellations to Be Finalized Within the Year

SK Hynix, which achieved its highest-ever quarterly results, has unveiled both its roadmap for the seventh-generation High Bandwidth Memory (HBM), known as 'HBM4E,' and its proactive infrastructure investment plans, signaling its determination to further solidify its leadership in the artificial intelligence (AI) memory market.

SK Hynix headquarters in Icheon, Gyeonggi Province. Photo by Yonhap News

During its first-quarter earnings conference call on April 23, SK Hynix announced its official target to supply HBM4E samples in the second half of this year and to begin mass production in 2027. Notably, the core die of HBM4E will feature the industry’s most advanced 10-nanometer-class sixth-generation (1c) process technology. Ki Tae Kim, Executive Vice President of HBM Sales & Marketing at SK Hynix, emphasized, "We are developing the base die based on optimal technology that meets our customers' required performance, and by applying the 1c process to the core die, we will ensure stable performance and supply volumes."

The company expressed strong confidence in the current memory market situation. Jun Deok Park, Executive Vice President of DRAM Marketing at SK Hynix, said, "As the importance of memory rises, demand for high-performance memory is surging, while supply remains limited. Amid this supply-demand imbalance, customers are now prioritizing securing volume over price, which is sustaining a strong pricing trend," adding, "As a result, we expect the favorable price environment for memory to continue for the time being."

The company also noted that as the memory supply shortage becomes prolonged, customers’ requests to secure mid- to long-term volumes are flooding in. In response, SK Hynix is considering entering into structurally different long-term agreements (LTA) compared to the past. If LTAs become established, the company expects improved demand visibility and earnings stability, which would help reduce the inherent volatility of the memory industry and drive a market revaluation of corporate value.

SK Hynix plans to establish a virtuous cycle of 'high returns and reinvestment' based on the strong profitability confirmed in the first quarter. This year’s capital expenditures (CAPEX) are expected to increase significantly compared to last year, with investments focused on ramping up operations at the Cheongju M15X facility, preparing infrastructure for the Yongin semiconductor cluster, and securing key extreme ultraviolet (EUV) equipment.

The company stated, "The Yongin cluster will see phased investments, starting with Phase 1, which will be completed early next year and continuing through Phase 6," adding, "We will also proceed as planned with essential equipment investments for transitioning to advanced processes by next year."

Building on its robust profit-generation capabilities, SK Hynix will strengthen its shareholder-friendly policies. The company particularly highlighted its ability to simultaneously achieve its financial goal of securing over 100 trillion won in net cash and expanding shareholder returns. It stated, "In addition to dividends, we are actively considering additional shareholder return measures, such as share buybacks and cancellations, and will finalize an implementation plan within the year."

Meanwhile, SK Hynix reported first-quarter sales of 52.5763 trillion won and operating profit of 37.6103 trillion won. These figures break the records set in the previous quarter for highest-ever sales (32.8267 trillion won) and operating profit (19.1696 trillion won) in just one quarter. Notably, quarterly sales surpassed the 50 trillion won mark for the first time, while operating profit increased by 95% over the previous quarter, setting a new all-time high.

This content was produced with the assistance of AI translation services.