As SK hynix leads the high-bandwidth memory (HBM) market, where demand has surged on the back of the artificial intelligence (AI) boom, and again set an all-time quarterly record in the third quarter (April–June), it signaled confidence that it will keep the lead in the next battleground, sixth-generation HBM (HBM4). SK hynix is understood to have met all performance requirements demanded by Nvidia, the "HBM big spender," finishing HBM4 supply talks ahead of others and planning full-fledged shipments starting in the fourth quarter. SK hynix also said that, beyond HBM, next year's DRAM and NAND flash volumes are effectively sold out, explaining that the memory semiconductor market has entered a super-boom phase.
◇ Next year's HBM supply "sold out"… record highs expected again in the fourth quarter
On the 29th, SK hynix announced that, on a consolidation basis, operating profit for the third quarter was 11.3834 trillion won, up 62% from a year earlier, according to preliminary figures. Third-quarter revenue came in at 24.4489 trillion won, up about 39% from the same period last year. SK hynix said, "Memory-wide demand surged as customers expanded investment in AI infrastructure," adding, "With increased sales of high value-added products such as 12-high HBM3E (fifth-generation HBM) and server-focused DDR5, we surpassed the all-time record set last quarter once again."
SK hynix also expressed confidence in the HBM4 market, which is emerging as next year's fiercest battleground. In addition to SK hynix, Samsung Electronics and Micron are known to be carrying out quality certification with Nvidia for HBM4 supply. While the industry voiced concern that SK hynix's market share would decline as rivals enter the market, SK hynix is assessed to have preemptively secured HBM4 volumes ahead of competitors. SK hynix said, "We have completed all talks with key customers for next year's HBM supply," adding, "HBM4, for which development was completed in September and mass production was established, will begin shipments in the fourth quarter, and we plan to ramp up full-scale sales next year."
Industry consensus is that all-time records will be renewed in the fourth quarter as well, when the uptrend in general-purpose memory semiconductor prices is reflected. On its third-quarter earnings conference call, SK hynix projected, "With expanded investment in AI data centers, our DRAM and NAND shipments in the fourth quarter will increase by a single-digit percentage or more from the prior quarter." Cha Yong-ho, an analyst at LS Securities, said, "The start of the upswing cycle in general-purpose memory was mid-September, so the impact on third-quarter results is limited," adding, "Full reflection in earnings will begin in the fourth quarter, and we expect record highs to be renewed once again."
◇ Memory demand to rise next year as well… "entered a super-boom phase"
As investment in the AI industry continues to expand, led by global big tech corporations, analysts say the boom in the memory semiconductor market will continue next year. Kim Un-ho, an analyst at IBK Securities, said, "Big tech corporations such as OpenAI, Oracle, and Nvidia, Nvidia are dispelling concerns over next year's (memory semiconductor) demand," adding, "With capacity additions for not only AI servers but also general servers expected to get into full swing, the memory semiconductor market is expected to remain strong."
SK hynix also said demand in the AI market is increasing sharply and projected that DRAM and NAND flash prices will continue to rise. SK hynix said, "Given the company's production capacity, not only HBM but also DRAM and NAND flash are effectively sold out for next year," adding, "DRAM demand growth will expand from the high-10% range this year to over 20% next year, and NAND is expected to improve from the mid-10% range this year to the high-10% range next year."
SK hynix said it will also begin in earnest to expand production capacity for next-generation 10-nanometer-class sixth-generation (1c, about 11–12 nm) DRAM, where demand is expected to grow starting next year. SK hynix said, "We began mass production of 1c DRAM this year, and a full-scale increase in mass production volume is expected next year," adding, "By the end of next year, the 1c DRAM process is expected to account for half of DRAM production capacity." SK hynix's strategy is to accelerate the migration to the 1c DRAM process, build out DRAM product lines for servers, mobile, and graphics, and expand supply to meet customer demand.