SK Hynix Plunges 9-10% After Earnings Release, Turns Lower

SK Hynix turned lower during trading today (29th) and is plunging by 9 to 10 percent.

As of 11:05 a.m. today on the main bourse, SK Hynix is trading at 1,414,000 won, down 8.77 percent from the previous session.

The losses later widened to the 9 to 10 percent range.

Starting up 1.10 percent at 1,567,000 won, SK Hynix soared as much as 4.45 percent to 1,619,000 won right after the market opened, but soon gave up its gains and turned downward.

Around 11:01 a.m., it even plummeted 10.19 percent to 1,392,000 won.

At the same time, Samsung Electronics is trading at 209,500 won, down 4.77 percent from the previous session.

Opening up 2.95 percent at 226,500 won and rising to 234,000 won to show a relatively solid trend, Samsung Electronics quickly turned weak as SK Hynix plummeted.

Bargain hunting flowed in during early trading following the 13 to 14 percent plunge the previous day, but the earnings released by SK Hynix today failed to meet market expectations, and disappointment over the lack of specific details regarding shareholder returns during the related conference call appeared to trigger panic selling.

SK Hynix's consolidated operating profit for the second quarter of this year was provisionally tallied at 60 trillion 542.6 billion won, up 557.2 percent from the same period last year.

The operating profit margin reached a whopping 76 percent.

However, this operating profit is about 4.7 percent lower than the market consensus of 63 trillion 552.6 billion won compiled by Yonhap Infomax.

Revenue rose 256.8 percent year-on-year to 79 trillion 318.7 billion won, and net profit increased 1,242.5 percent to 93 trillion 922.6 billion won.

Regarding concerns over reduced artificial intelligence (AI) infrastructure investment, which served as the pretext for the semiconductor stock correction, SK Hynix stated during the conference call, "As AI competition and service expansion among cloud service providers (CSPs) continue, we expect AI infrastructure investment to remain robust beyond next year."

It also forecasted that in the second half, "Earnings improvements will be further reinforced as the effect of rising average selling prices (ASP) driven by mix improvements unfolds together."

Regarding the progress of next year's high-bandwidth memory (HBM) price negotiations, it explained, "It is difficult to disclose specific prices and details due to contracts," adding, "We are discussing supply volumes and prices with major clients, and discussions are proceeding smoothly based on robust customer demand."

Regarding shareholder returns, it stated that it is reviewing various methods of additional shareholder returns.

Meanwhile, in the U.S. New York stock market overnight, semiconductor stocks such as Micron (-8.85%), AMD (-8.15%), and Western Digital (-6.91%) plunged significantly under the influence of the previous day's crash in the Korean stock market, causing the Philadelphia Semiconductor Index to plummet by 4.49 percent.

As of this time on the main bourse, foreigners and institutions are net buyers of 185.4 billion won and 1 trillion 182.8 billion won, respectively.

Individuals are selling a net 1 trillion 361 billion won alone.

In the KOSPI electrical and electronic sector, to which Samsung Electronics and SK Hynix belong, foreigners and institutions are also in a buying advantage with 94.9 billion won and 812.3 billion won, while individuals are in a selling advantage with 892.1 billion won.

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.