Credit: SK Hynix.
For decades, the name Samsung 삼성 has been synonymous with the best of the best of South Korea, largely thanks to the company’s world-beating semiconductor manufacturing. But this year, there is a new sheriff in town: SK Hynix SK 하이닉스, long eclipsed by Samsung, is projected to beat Samsung Electronics 삼성전자’s semiconductor division in operating profits this year.
In its earnings announcement on October 27, SK Hynix recorded an operating profit of KRW 7.3t (USD 5.3b) for Q3 2024, a new record for the company and nearly twice the KRW 4t (USD 2.9b) in operating profits reported by Samsung Electronics’ Device Solution Division, which manufactures semiconductors. SK Hynix has already led Samsung Electronics throughout the first three quarters of 2024; in the likely event that the trend holds through the end of the year, it would be SK Hynix’s first time outearning Samsung Electronics in operating profit for semiconductor manufacturing.
SK Hynix owes its rise to the AI industry’s demand for semiconductors. The company is the market leader in high bandwidth memory (HBM) chips, used in artificial intelligence applications, and is virtually the sole supplier of HBM chips to Nvidia, whose market value exploded with the rise of AI. Meanwhile, demand for DRAM chips, traditionally an area of strength for Samsung Electronics, has fallen amid slowing demand for computers and smartphones.