SK hynix announces $28.6 billion share buyback, largest in South Korean corporate history

Aug 19, 2026

SK Hynix announced a historic 40 trillion won ($28.6 billion) share buyback and cancellation program, the largest in South Korean corporate history. The chipmaker also raised its shareholder return target to over 50% of its 2025-2027 cumulative free cash flow. The move follows intense investor pressure to distribute cash windfalls from the AI memory boom, especially after SK Hynix shares fell 40% from their June 2026 peak despite record second-quarter earnings.

SK Hynix $28.6 billion buyback

▪SK Hynix will buy back up to 24.07 million common shares on the open market between August 20, 2026, and November 19, 2026, representing approximately 3.3% to 3.4% of its outstanding shares.
▪SK Hynix announced on August 19, 2026, that its board approved a plan to buy back and cancel 40 trillion won ($28.6 billion) of its treasury shares.
▪The 40 trillion won buyback by SK Hynix represents the largest repurchase and cancellation of treasury shares ever announced by a listed South Korean company.

Shareholder return policy expansion

▪SK Hynix is reviewing a higher fixed dividend and a potential special dividend, with specific details scheduled to be announced alongside its third-quarter 2026 earnings release.
▪SK Hynix delayed its shareholder return announcement until early August 2026 due to US regulatory disclosure restrictions tied to its July 10, 2026, American depositary receipt listing.
▪SK Hynix raised its shareholder return target to more than 50% of its cumulative free cash flow generated between 2025 and 2027, up from its previous target of up to 50%.

AI memory boom

▪SK Hynix holds approximately 58% of the global high-bandwidth memory market, compared to 21% each for Samsung Electronics and Micron Technology, according to Counterpoint first-quarter data.
▪SK Hynix has mass-produced HBM4 memory chips in the second quarter of 2026, securing long-term agreements with around ten customers for terms typically running five years.
▪SK Hynix has committed to heavy capital expenditures, including a 54 trillion won board approval on August 7, 2026, for the Yongin Y2 and Cheongju M17 fabrication facilities.

Record earnings performance

▪SK Hynix reported that its net cash stood at approximately 69 trillion won at the end of the second quarter of 2026.
▪SK Hynix reported record second-quarter 2026 revenue of 79.32 trillion won and an operating profit of 60.54 trillion won, representing a 76% operating margin.

Stock price decline

▪SK Hynix stated that its 40 trillion won buyback reflects its assessment that the company's intrinsic value and competitiveness are not fully reflected in its current stock price.
▪The decline in SK Hynix shares was driven by investor concerns regarding the sustainability of artificial intelligence infrastructure spending by major United States technology companies.
▪SK Hynix shares fell nearly 10% on August 19, 2026, before recovering some losses in post-market trading, following a 40% decline from their June 2026 peak.

Investor pressure for payouts

▪SK Hynix and Samsung Electronics have faced intense investor pressure to return excess cash to shareholders following record profits driven by the artificial intelligence memory boom.
▪Samsung Electronics stated it will share details of its shareholder returns policy very soon, while Micron Technology has pledged to return 100% of its excess cash to shareholders.