SK Hynix on April 24 reported a record first-quarter operating profit, driven by booming demand for high-bandwidth memory (HBM) chips used in artificial intelligence (AI) applications, defying typically weak seasonal trends in the semiconductor sector.
The South Korean chipmaker posted an operating profit of 7.44 trillion won ($5.4 billion) for the January–March period, up 157.8% from a year earlier and exceeding analysts’ average forecast of 6.59 trillion won. Revenue climbed 41.9% to 17.63 trillion won.
The results marked the company’s second-highest quarterly earnings ever, following a record-setting fourth quarter. Its operating margin rose to 42%, up a percentage point from the prior quarter, nearing Taiwan’s TSMC’s 48.5%. It was also SK Hynix’s eighth consecutive quarter of margin expansion.
The company attributed the strong performance to robust sales of premium memory products, including HBM and high-end DRAM, which are essential for AI server infrastructure. It expects the momentum to continue, forecasting that HBM demand will more than double in 2025 compared to last year.
“Despite the seasonal lull, we delivered results that clearly show a shift in our competitiveness,” the company said. “We will continue to focus on structural improvements that allow us to perform strongly even during traditionally slow periods.”
SK Hynix noted that demand for its HBM chips remained resilient despite global trade uncertainties, including potential U.S. tariffs under the Trump administration. The company said long-term supply agreements, typically set a year in advance, helped shield its business from disruption.
“Global customers have maintained their planned memory purchases,” said Vice President Kim Woo-hyun, downplaying concerns about preemptive stockpiling. He added that DRAM shipments in the first quarter were largely in line with internal projections.
Beyond HBM, SK Hynix benefited from a surge in demand for other high-value memory products amid an accelerating global push to develop AI models. The launch of affordable, high-performance Chinese models such as DeepSeek has lowered entry barriers, spurring broader adoption of AI and fueling demand for AI server components.
Kim said sales of 96GB DDR5 DRAM modules increased during the quarter. As a result, DRAM—including HBM—accounted for 80% of the company’s total revenue, up from 74% in the previous quarter.
According to Counterpoint Research, SK Hynix captured a 36% share of the global DRAM market in the first quarter, ranking as the top supplier by revenue.
Looking ahead, the company plans to boost production of its fifth-generation HBM3E chips, aiming for them to account for more than half of HBM sales in the second quarter. It also expects to complete preparations for mass production of its sixth-generation HBM4 chips by the end of 2025.
To maintain profitability, SK Hynix is stepping up its focus on high-margin products such as AI PC memory modules and enterprise SSDs. The company will centralize advanced DRAM production at its new M15X fab in Cheongju, scheduled for completion this year, while reducing DDR4 output to single-digit levels—down from about 20% last year. Samsung Electronics and Micron Technology are reportedly following similar steps to phase out DDR4.
Still, SK Hynix faces intensifying competition from Chinese chipmakers such as CXMT, which are ramping up production of legacy DRAM products and contributing to downward pricing pressure. Although the company’s profits remained strong, first-quarter revenue slipped slightly from the previous quarter due to these headwinds.
