SK Hynix Plunges 10% as Earnings Miss Deepens Chip Rout
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- SK Hynix posted record Q2 results with operating profit of KRW 60.5 trillion ($42.5 billion), up 557% year-over-year, yet missed the KRW 64 trillion consensus by roughly 5% on revenues and operating profit, sending shares down nearly 10% (intraday low of 19%) to trade more than 50% below their June all-time high.
- Mike O'Rourke of Jones Trading called the 5% slippage "inexcusable" given SK Hynix's recent $29 billion Nasdaq DR listing, criticizing the company for poor "communication and messaging" only weeks after that milestone.
- China's CXMT listing on Shanghai and reports that Chinese firms developed deep ultraviolet lithography machines for chip manufacturing triggered fears of cheap DRAM at scale, prompting analysts to warn the semiconductor supercycle could prove short-lived.
- Futurum's Rolf Bulk countered that narrative, telling CNBC CXMT remains "2 to 3 generations behind SK Hynix, Samsung and Micron" in chip performance, and other analysts noted the miss may reflect annually negotiated HBM contracts diluting quarterly ASP growth rather than fundamental weakness.
- Samsung fell 5%, Kioxia dropped 13% after Tuesday's 15% plunge, and the Philadelphia Semiconductor Index slid 4.49% on the same China-competition concerns, confirming the SK Hynix move is part of a sector-wide rout.
- Korea's Kospi has lost 41% of its market capitalization over 28 trading sessions, with 360,000 retail accounts wiped out, 1.2 million margin calls logged, and circuit breakers triggered for the second straight day — the tenth such halt this year.
- The Korea Securities Commission is moving to restrict leveraged ETFs used to amplify exposure, with new limits taking effect Friday July 31.
Why it matters: Record profits are no longer enough to clear the bar for SK Hynix: the 5% consensus miss on KRW 60.5 trillion in operating profit shows how unforgiving sentiment has become as Chinese competitive threats collide with extreme retail leverage in Korea. With 360,000 retail accounts already wiped out and 1.2 million margin calls, regulators are rushing in with leveraged-ETF curbs effective July 31 — a structural change to how Korean retail 'ants' access the market.
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