SK hynix said it is preparing on-time supply of HBM4, the sixth-generation high bandwidth memory (HBM), by working closely with major customers from the early stages. The company added that HBM demand over the next three years will exceed its own production capacity and said it will pursue an optimization strategy focused on profitability based on its solid market leadership.
At its first-quarter earnings conference call on Apr. 23, SK hynix, responding to a question about the HBM4 shipment timeline and market outlook, said, "From the customer's perspective, for HBM, not only performance such as speed and power but also integrated competitiveness that includes quality, Production yield, and supply stability is being evaluated as even more important," adding, "Our HBM4 has built development and supply systems through close collaboration with major customers from the early stages." It added, "We are preparing to ramp up products with the performance customers require and supply them on time."
The company also specifically addressed supply constraints stemming from explosive demand for artificial intelligence (AI) chips. The company said, "Demand required of us over the next three years is at a level that exceeds our capacity," and added, "We are striving to ensure smooth HBM supply within limited capacity."
Above all, it made clear it will strictly manage profitability in a supplier-favorable market environment. SK hynix said, "Given the shortage in general DRAM supply, we are implementing optimal allocation between HBM and general DRAM on the supply side rather than simply maximizing sales," and emphasized, "We will continue to solidify market leadership with product competitiveness, including HBM3E."
This is interpreted as a strategy to maximize profit through lineup optimization rather than pushing excessive volume for superficial scale expansion, leveraging its overwhelming market share. It is seen as a show of confidence to maintain firm technological leadership in cutting-edge standards such as HBM4 and its successor HBM4E, based on long-term partnerships with customers.
Meanwhile, SK hynix announced that it posted 52.576 trillion won in consolidation sales and 37.61 trillion won in operating profit in the first quarter. This is the first time SK hynix's quarterly sales have exceeded 50 trillion won. Sales jumped 198% and operating profit surged 405% from a year earlier, marking the best results since the company's founding.
In particular, helped by an improved product mix focused on profitability, the quarterly operating margin reached 72%, the highest level since then. Not only did it soar 30 percentage points from the same period last year (42%), it also far outstripped major big tech rivals, including Samsung Electronics. Compared with the market consensus over the past month compiled by FnGuide (sales 53.9208 trillion won, operating profit 38.2585 trillion won), sales were about 2.5% lower and operating profit was about 1.7% lower.