SK Hynix Eyes Strong Recovery Amid AI Server Demand and Pricing Recovery

SK Hynix (KRX: 000660), South Korea’s leading memory chipmaker, is poised for a sharp recovery in 2024 after a tumultuous 2023. The company’s turnaround is to be led by its dynamic random-access memory (DRAM) business, particularly the high bandwidth memory (HBM) sub-segment, which facilitates faster data transfer between processors and memory — a critical component for AI-driven workloads.

Based on Visible Alpha consensus, SK Hynix’s DRAM revenue is expected to climb +113% year-over-year in 2024, with HBM revenue alone projected to soar +368% on the back of higher shipments and premium pricing for the latest HBM3E products. HBM’s share of SK Hynix’s total revenue is set to rise from 8% in 2023 to 19% in 2024, with forecasts suggesting it could reach 32% by 2026. The company’s NAND segment is also expected to perform robustly, with revenues anticipated to rise +111% year-on-year, driven by a rebound in average selling prices (ASP) and stronger demand for enterprise solid-state drives (eSSD).

Overall, analysts expect SK Hynix’s revenues to surge by +102% year-on-year in 2024, rebounding from a -27% decline last year. This recovery trend extends to the broader memory market, with rival Samsung Electronics (KRX: 005930) also forecasted to see memory revenues rise by +93% in 2024 after a -36% fall in 2023.