SK Hynix posted record Q2 2026 profit but missed analyst forecasts due to conservative HBM pricing; completed 10 long-term supply agreements (LTAs).
SK hynix reported record second-quarter results, with revenue surging 257% year-over-year to 79.32 trillion won (US$54.55 billion) and operating profit jumping 557% to 60.54 trillion won. However, both figures fell short of analyst expectations of 84 trillion won and 64 trillion won, respectively.
The earnings shortfall stemmed primarily from SK hynix's more conservative pricing strategy, particularly under long-term customer agreements, which prevented the company from matching Samsung Electronics' pricing power. According to DS Investment & Securities analyst Lee Su-rim, Samsung has raised prices more aggressively than SK hynix. Despite this, SK hynix maintained strong pricing momentum during the quarter, with DRAM average selling prices rising 30% quarter-over-quarter and NAND ASPs increasing in the mid-50% range.
SK hynix disclosed that it has completed ten long-term supply agreements, which feature financial arrangements including customer deposits designed to secure stable demand while providing visibility into medium- and long-term requirements. These agreements target major AI players, with customers including leading U.S. hyperscalers and AI chipmakers such as NVIDIA. The strategy underscores the company's confidence in demand outlook and its commitment to supporting next-generation AI infrastructure.
NVIDIA exemplified this trend by announcing a multi-year AI memory supply agreement with SK hynix, potentially valued at up to $500 billion, along with plans to build large-scale data centers expected to come online in 2027. This shift toward long-term agreements is reshaping the broader memory industry, with major suppliers including SK hynix, Samsung Electronics, and Micron steadily expanding such contracts. Samsung currently generates approximately 40% of its revenue from long-term agreements, with this share expected to rise further.
On the technology front, SK hynix's HBM4, which began mass production shipments in the second quarter, has achieved yield and quality levels comparable to its mature HBM3E product. The company has completed customer sampling for HBM4E and is targeting mass production in 2027. SK hynix is also developing next-generation solutions, including HBM5 and iHBM, which integrates hybrid bonding to address thermal challenges. iHBM incorporates built-in cooling elements to reduce thermal resistance by approximately 30% compared with existing solutions.
Sales of SOCAMM2, an AI-focused memory module that adapts low-power mobile DRAM for server environments, also accelerated in the second quarter. The company expanded shipments of products using its 10nm-class sixth-generation DRAM process. In NAND, the 321-layer variant now represents the largest share of output, with SK hynix targeting it to account for roughly 50% of domestic production capacity by year-end.
Reflecting its confidence in sustained demand, SK hynix plans to increase capital spending this year to the high-40 trillion won range, up from 30.173 trillion won in 2025.