In recent months, the global chip market has witnessed significant developments, particularly due to the surging demand propelled by artificial intelligence (AI) advancementsOne of the most prominent players in this landscape is SK Hynix, the world's second-largest memory chip manufacturerTheir recent financial report has caught the attention of investors and analysts alike, showcasing remarkable growth driven by their high-bandwidth memory (HBM) chips, which are critical for AI applications.

On January 23, the company announced its quarterly earnings, and the numbers are nothing short of astonishingIn the fourth quarter of 2024, SK Hynix recorded an impressive operating profit of 8.08 trillion Korean won (approximately 408 billion RMB), marking a staggering increase of over 2235.8% from the previous yearRevenue reached 19.77 trillion won (around 1 trillion RMB), reflecting a 74.8% year-on-year growthRemarkably, the total annual revenue for 2024 hit a record 66.19 trillion won, showing a 102% increase compared to 2023's performance, which had been adversely affected by market downturns.

This exceptional growth is largely attributed to the booming demand for artificial intelligence technologies, which has significantly boosted sales of SK Hynix's HBM chipsIndustry analysts have pointed out that the company’s remarkable performance underlines the booming expenditures on global data centers and reinforces SK Hynix’s leading position in the supply of HBM chips used in AI accelerator training tasks, particularly for companies like NVIDIA.

As major tech companies continue to ramp up their investments in AI infrastructure, SK Hynix anticipates that the importance of AI inference technology will also escalateConsequently, the demand for high-capacity server DRAM and HBM will likely continue its upward trajectoryThis projection is further supported by the capital markets; from January 1 to January 22, SK Hynix's stock price surged nearly 30%. However, on the day after announcing its financial results, the share price experienced a 2.66% dip, resulting in a market capitalization of around 159.8 trillion won, roughly equivalent to 807.9 billion RMB.

The extraordinary rise in quarterly operating profit is particularly remarkable considering it has surpassed that of Samsung Electronics, South Korea's other major chip manufacturer

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Analysts noted that this marks the first time SK Hynix's operating income surpassed Samsung's, which is indicative of fierce competition within the HBM marketSamsung had previously projected a fourth-quarter operating profit of approximately 6.5 trillion won, but SK Hynix’s superior performance showcases the strides they have made in this competitive sector.

On a broader scale, SK Hynix's achievements are not limited to quarterly reports; the total annual revenue for 2024 signifies a notable comeback from the previous year's lossesIn 2023, SK Hynix reported a staggering net loss of 9.13 trillion won due to an oversupply in the marketThis year, the company recorded a net income of 19.79 trillion won, and the operating profit turned around from a loss of 7.73 trillion won in 2023 to a historic high of 23.46 trillion wonThese figures have set a record not seen since the semiconductor industry boom in 2018.

The company's robust performance has been linked to the rising demand for AI memory solutionsDuring the fourth quarter of 2024, the appetite for AI semiconductors grew dramatically, with HBM technology contributing significantly to the overall DRAM sales, accounting for over 40%. SK Hynix's diversified product line and competitive pricing strategies have established a sound financial footing, allowing for ongoing performance improvements.

Amidst these transformations, SK Hynix emphasized the necessity of timely product supply aligned with customer demands as a critical competitive advantageThe company clearly stated that their results validate this strategy and reflect its significance moving forward.

Looking to the future, SK Hynix anticipates ongoing benefits from the “Stargate” project—a significant collaborative initiative among leading tech giants including SoftBank Group, OpenAI, and OracleThese companies are set to invest a breathtaking $500 billion into building AI infrastructure in the United StatesThe project's initial investment alone is estimated at $100 billion, aimed at constructing data centers to support AI development

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