SK Hynix, a leading memory chipmaker, reported a record quarterly profit for the third quarter of 2023, largely fueled by robust demand for high bandwidth memory (HBM) utilized in generative AI applications.

The company's revenue surged by 94% year-on-year to reach 17.6 trillion won, although it fell slightly short of the anticipated 18.2 trillion won.

Sales of HBM increased over 70% from the previous quarter and more than 330% compared to the same period last year, highlighting the explosive growth in this sector.

The broader memory chip market is showing signs of recovery, with prices rebounding after a previous slump, which has positively impacted SK Hynix's performance.

CFO Kim Woohyun emphasized the company's commitment to maximizing profitability and stable revenues through flexible product and supply strategies.

The results were announced on October 24, 2024, reflecting a positive trend for the semiconductor industry amid increasing needs for AI technology.

Net income for Q3 2024 reached $4.13 billion, marking a significant recovery from a loss of approximately $1.5 billion in the same quarter last year.

In addition to AI chips, strong demand for enterprise solid-state drives in data centers has also contributed to the company's earnings.

Despite facing price volatility due to competition from new entrants and legacy products, SK Hynix anticipates an improvement in its average selling price as it increases its share of high-value products.

The company plans to enhance its NAND operations and expand sales of high-capacity enterprise solid-state drives (eSSDs) to meet rising demand.

Looking ahead, SK Hynix expects demand for HBM chips, particularly for AI applications, to continue to surpass supply in 2024, despite concerns about potential oversupply.

Analysts remain optimistic about SK Hynix's future, with major firms like Goldman Sachs and Citigroup raising their stock price targets due to anticipated growth driven by AI demand.