Nvidia supplier SK Hynix warns of demand volatility after quarterly profit soars 158% on AI boom

A smartphone screen showing the logo of the SK Hynix company was illustrated in a photograph.
SK Hynix of South Korea exceeded revenue and operating profit expectations for the quarter, driven by strong demand for its high-speed memory products used in artificial intelligence chips.

In the first quarter, SK Hynix reported revenue of 17.64 trillion won ($12.36 billion) compared to the estimated 17.26 trillion won, and operating profit of 7.44 trillion won versus the expected 6.62 trillion won. This marks a 42% increase in revenue and a 158% surge in operating profit year on year.

Despite a drop in revenue and operating profit from the previous quarter, the company highlighted the impact of AI on the memory market. SK Hynix expects continued demand for AI servers and anticipates growth in consumer electronics with new products featuring AI capabilities.

An executive from SK Hynix expressed concerns about potential tariffs affecting semiconductor products and the impact on demand. The company emphasized its position as a key supplier of high bandwidth memory to clients like Nvidia and its dominance of the HBM market. SK Hynix plans to expand its production capacity with a new facility in South Korea, aiming to start mass production by November 2025.

The South Korean government’s increased support for the chip industry and uncertainties in global trade tariffs have influenced SK Hynix’s plans and market performance. Despite this, the company’s shares experienced a slight decline in Asian markets.