SK Hynix Shares Plunge More Than 11% on Profit Concerns

SK Hynix, the leading high-bandwidth memory chipmaker with a 58% global market share, is a key supplier of Nvidia's AI chips. However, prices for its flagship HBM products are largely fixed under long-term contracts. As shortages drive sharp gains in conventional DRAM prices, the increase in HBM's average selling price remains constrained, raising market concerns about the South Korean giant's near-term earnings momentum and pricing flexibility despite the AI boom.

Positive momentum faded after SK Hynix completed a $26.5 billion ADR issuance in the United States, while Korea Investment & Securities forecast that its second-quarter operating profit would fall 8% short of market expectations. The combined pressures sent the shares down more than 11% on Monday. However, institutions including Chailease said the sharp short-term decline reflected an excessive reaction to the company's financial results and advised investors to use available mechanisms to accumulate positions gradually for long-term exposure to the AI trend.