SK hynix third-quarter operating profit may top W80tr as Solidigm IPO clouds outlook

SK hynix will hold an earnings call Wednesday morning to announce its third-quarter results, along with updates on its HBM business and shareholder return plans.

Market attention is focused on Solidigm, the company's US-based great-grandchild subsidiary, which has become embroiled in a dual-listing controversy. With financial regulators having in effect put the brakes on Solidigm's planned NASDAQ listing, investors are watching closely to see whether SK hynix will address its position on the matter and outline how it plans to secure future investment funding.

According to industry sources, SK hynix's third-quarter operating profit is expected to set an all-time high for the sixth consecutive quarter, extending a streak that began in the second quarter of last year.

The analyst consensus estimate stands at 76.96 trillion won ($57.8 billion). While the sharp drop in the won-dollar exchange rate has recently tempered expectations, some analysts still anticipate a surprise result exceeding 80 trillion won, driven by strong HBM4 sales.

Meritz Securities forecast third-quarter operating profit at 80.06 trillion won, with an operating margin of 80 percent, citing earnings contributions from HBM4, which began full-scale supply in the second half of the year. The brokerage estimated that DRAM generated 63 trillion won in operating profit while NAND contributed 17 trillion won.

The market is also watching for updates on SK hynix's long-term supply agreements for memory chips and its outlook for the broader memory industry. At its second-quarter earnings call, the company said it had concluded long-term agreement negotiations with more than 10 customers, and added that "major customers are still requesting even more memory supply."

However, with Microsoft, OpenAI, Anthropic and other major technology companies recently raising the prospect of a slowdown in AI investment, views on the memory market outlook are divided — making SK hynix's assessment of medium- to long-term memory demand a key point of interest.

Investors are also watching for details on additional shareholder returns. SK hynix announced in August a plan to buy back and retire 40 trillion won worth of its own shares, and had signaled that "the specific scale and method of additional shareholder returns will be announced at the time of the third-quarter earnings release."

Whether the company will clarify its stance on the Solidigm dual-listing controversy is another focus. SK hynix recently selected Goldman Sachs and Morgan Stanley as lead underwriters for Solidigm's initial public offering, but the situation entered a new phase Monday when Financial Supervisory Service Director Lee Chan-jin told the National Assembly's Political Affairs Committee during a national audit that "both the Financial Services Commission and we have concluded that this constitutes a violation of dual-listing rules."

Solidigm was established after SK hynix acquired Intel's NAND flash business. The company has drawn dual-listing criticism because of a five-layer ownership chain running from SK Group through SK Square, SK hynix and an AI company down to Solidigm.

The Financial Services Commission and Korea Exchange began enforcing guidelines on Aug. 3 that in principle prohibit dual listings to protect shareholders, allowing exceptions only when a parent company's board has fulfilled its duty of loyalty to shareholders. The rules apply equally when a subsidiary is dual-listed on an overseas exchange.

SK hynix has maintained that nothing has been finalized regarding Solidigm's listing. The company said it will weigh not only the impact on shareholders but also the benefits of accessing outside capital and the financial implications of the fundraising.