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SK hynix · 000660 · Semiconductors

SK hynix posts record Q3 profit and announces ₩20.0T share buyback

Why this report

Written after:

SK hynix reported preliminary Q3 2026 operating profit of ₩83.3T, up 632.1% year on year, and decided on a new ₩20.0T share buyback. The results support the earnings-recovery picture in the previous report, and the model estimate moves only slightly.

Written Oct 28, 2026 · Data as of Oct 27, 2026 · 0 views

This is not financial advice. The report does not recommend buying or selling anything.

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What happened

The preliminary consolidated results for Q3 2026 (July to September) show revenue of ₩104.6T, up 327.9% year on year and 31.9% from Q2. Operating profit was ₩83.3T, up 632.1% year on year and 37.6% from Q2. Nine-month operating profit was ₩181.5T against ₩28.0T a year earlier. The filing notes these are preliminary figures that may differ from final ones.

Pre-tax profit from continuing operations was ₩50.7T, down 58.7% from Q2's ₩122.7T. Net profit was ₩39.8T, down 57.7% from Q2 and up 215.7% year on year. The filing excerpt does not explain the gap between operating and pre-tax profit, so we cannot say what drove it.

On the same day the board decided on a new buyback of 14,920,000 common shares worth ₩20.0T, equal to about 2.0% of market value. Purchases are on the market from 2026-10-29 to 2027-01-28. The share count was calculated at the 2026-10-27 close of ₩1,341,000 and may change with the price. About ₩10T is for raising shareholder value and about ₩10T for employee share-based pay such as bonuses. The company held 25,318,968 treasury shares (3.47%) before this decision.

A Q3 cash dividend decision was also filed. News reports cite ₩14T, or ₩20,000 per common share, and a total shareholder return of ₩100T this year including cancellations. We could not verify those figures in the filing excerpts. Reports also say the company signed long-term supply agreements with 14 firms covering over 50% of 2027-2028 capacity, and that management said DRAM and HBM supply through 2029 is virtually sold out. These are conference-call and news statements, not filing figures.

What it changes for the thesis

The previous report (2026-10-21) said the earnings recovery was intact but that the share price had fallen sharply and the market seemed to assume peak-like earnings would last. The Q3 figures confirm the recovery was strong, and Q3 operating profit is well above the trailing H1 2026 figures behind the model. The key open question, whether peak-like earnings last, is not settled by one quarter. The reported long-term supply agreements and sold-out comments speak to that question, but they are management statements we cannot verify.

The previous report also flagged heavy foreign selling and the end of the earlier buyback as uncertainties. The new ₩20.0T buyback addresses the second point directly, though about half is meant for employee pay rather than reducing share count. Foreign ownership is now 48.7% against 50.9% sixty days ago, and foreign investors were net sellers of about ₩14.7T over 20 days, so the selling pressure is not yet reversed. The weak Q3 pre-tax and net profit versus Q2 is a new item to watch.

What it changes for the valuation

The model estimate is still based on trailing data to H1 2026 and does not yet include Q3. It is now ₩684,217 bear, ₩883,705 base and ₩1,156,678 bull per share (DCF, 12.4% rate), against ₩676,946, ₩872,969 and ₩1,140,647 in the previous report. The base moved up about 1.2%, mostly from a slightly lower discount rate.

The share price closed at ₩1,341,000 on 2026-10-27, above the bull estimate by about 15.9% and above the base by about 51.7%. It is down 28.0% over one month. Trailing P/E is 6.0, P/B 3.7 and P/S 5.2. EV/EBITDA is not available and dividend yield is 0.2% on trailing data. These are a model estimate based on the assumptions shown, not a price target, and they are sensitive to the discount rate and the earnings level assumed. Q3 figures could change the inputs once they enter the model.

Closing view

The evidence is mixed but leans toward confirming the operating picture. Record operating profit, a large buyback and reported long-term supply agreements all support the earnings case. Against that, the market price still sits above even the model's bull estimate, the model has not yet absorbed Q3, net profit fell sharply from Q2 for reasons the filing excerpt does not show, and foreign investors remain net sellers. The key test is whether profits stay near these levels once the final figures and the next quarters arrive.

Model estimate of fair value

Bear
₩684,217
-52%
Base
₩883,705
-38%
Bull
₩1,156,678
-18%

Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal.

Base case of the 5-year discounted cash flow model on the stock's Valuation tab (statements TTM to H1 2026; discount rate 12.4%). Bear and Bull move the main assumptions by fixed steps. See and change the assumptions

Filings and data used

Report history

  1. Oct 28, 2026Update noteNews · Earnings · Buyback / dividend / value-upSK hynix posts record Q3 profit and announces ₩20.0T share buyback
  2. Oct 21, 2026Update noteModel fair value changeSK hynix: Model fair value estimate rises 60% to ₩872,969 base
  3. Oct 20, 2026Update noteNewsSK hynix: Record Q3 profit expectations meet a sharp market sell-off
  4. Oct 13, 2026InitiationSK hynix: Record Earnings Run Meets a Sharp Share Price Pullback

Built only from jonbur's own data: prices and investor flows, filed financial statements and filings, and news headlines. Disclosed (filed) data is labelled as such. Written by AI and may contain mistakes.

This is not financial advice. The report does not recommend buying or selling anything.

Source: KRX statistical information