SK Hynix’s $950 Billion Alliance Can’t Stop a 41% Slide as Earnings Put Sentiment to the Test
Published on 07/27/2026 at 05:51 | Redaktion boerse-global.de
The numbers coming out of Seoul this week are almost too big to process. SK Hynix is sitting on a contract package worth more than $500 billion with Nvidia alone, part of a broader $950 billion semiconductor pact between South Korean and US technology giants. Yet the stock closed Friday at 1,759,000 won — down 8.34 percent in a single session and 41.11 percent below its June 25 peak.
The disconnect between corporate fundamentals and market action has rarely been starker. Investors are now waiting for Wednesday’s second-quarter earnings report to determine which force wins out: the unprecedented demand from artificial intelligence infrastructure or the creeping fear that valuations have simply run too far, too fast.
A Deal-Making Blitz in San Francisco
The flurry of agreements came together last week on the sidelines of the AI Summit in San Francisco, where South Korean President Lee Jae-myung personally unveiled the partnerships. The centerpiece is a long-term HBM4 memory chip supply deal between SK Hynix and Nvidia valued at more than $500 billion, covering chips for Nvidia’s upcoming Vera-Rubin platform. SK Telecom separately signed a memorandum of understanding to build a 2-gigawatt AI cloud infrastructure using Nvidia’s technology, with the first facility expected to go live in 2027.
Microsoft also secured a long-term memory supply agreement, while SK Telecom inked a separate gigawatt-scale data center MOU with Anthropic. Samsung Electronics added another $200 billion pact with Broadcom for memory and foundry capacity, bringing the total South Korean-US semiconductor package to roughly $950 billion.
Should investors sell immediately? Or is it worth buying SK Hynix?
For SK Hynix, these deals lock in demand for its most advanced products years into the future. The company already commands 56.4 percent of the high-bandwidth memory market, a share that BNP Paribas now puts at 57 percent, with Samsung at 22 percent and Micron at 21 percent. The global HBM market is projected to double from $76 billion this year to $156 billion by 2027.
Earnings Expectations Are Sky-High
The consensus for Wednesday’s second-quarter report, compiled by FnGuide, calls for revenue of 84.17 trillion won — a 278.6 percent surge from a year earlier. Operating profit is expected to come in at roughly 64.24 trillion won, a sevenfold increase. Some analysts project an operating margin between 75 and 77 percent, above the 60.3 percent TSMC recently reported.
KB Securities has raised its price target for SK Hynix to as high as 4.2 million won, arguing that memory prices will climb at least 30 percent in the third quarter as HBM4 production bottlenecks tighten supply. Samsung Securities believes the peak of the AI investment cycle has yet to arrive.
Those bullish forecasts clash with the stock’s recent trajectory. The Kospi index plunged 5.72 percent on July 24 amid fears that AI-sector valuations had become overheated, dragging SK Hynix down with it. The stock’s 14-day relative strength index now sits at 40.1 — not yet oversold but signaling weak momentum. Annualized 30-day volatility has surged past 118 percent, reflecting extreme nervousness around the HBM4 supply commitments and the earnings release.
The ADR Premium Problem
Compounding the uncertainty is a structural anomaly in SK Hynix’s US-listed shares. The company raised $26.5 billion on July 10 through the largest foreign initial public offering in US history, listing 177.9 million American depositary receipts at $149 each. The ADRs jumped 17 percent on their first trading day.
Since then, however, the US shares have traded at a premium of 16 to 51 percent over the Seoul-listed common stock — and investors cannot arbitrage the gap because conversion restrictions are in place. James Mackintosh, a columnist at the Wall Street Journal, called the premium “another sign of the AI trading frenzy,” noting that TSMC’s ADR premium averaged just 3 percent between 2010 and 2020 and only rose to 15 percent after the ChatGPT boom. Demand for US-listed chip stocks, he concluded, is “out of control.”
SK Hynix at a turning point? This analysis reveals what investors need to know now.
Institutional Buying Offers a Counter-Narrative
Not everyone is running for the exits. South Korea’s National Pension Service bought a net 425.8 billion won worth of SK Hynix shares in July, according to Korea Economic Daily. Analyst Cha Young-joo recommended using price weakness as a buying opportunity. The Kospi’s price-to-earnings ratio of 5.7 also suggests the broader market is historically cheap, even if individual stocks have run hard.
Samsung’s delivery of the first HBM4E memory samples last week added a competitive twist, signaling that the race for the next memory generation is accelerating. For now, SK Hynix retains the lead, but the gap may narrow.
Wednesday’s earnings call will be the first time management provides concrete details on pricing, capacity utilization, and HBM4 delivery timelines. With a $950 billion alliance on one side and a 41 percent drawdown on the other, the report could determine whether SK Hynix’s stock is in a buying opportunity or a value trap.
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