SK Hynix: Record 37 Trillion Won Profit and $14 Billion US IPO Plan Collide with $6.6 Billion Foreign Exodus

Foreign investors dump $6.6B in Korean chip stocks, but SK Hynix posts record 72% margins, targets $14B NYSE IPO, and braces for new leveraged ETF volatility.

South Korea’s stock markets may have been quiet on Monday’s holiday, but the calm masked a fierce tug-of-war over the country’s largest semiconductor maker. International investors have dumped nearly $6.6 billion worth of shares in Samsung Electronics and SK Hynix since the start of May, with the latter absorbing the brunt of the selling. Net outflows from SK Hynix alone exceeded 5 trillion won last week, accounting for almost three-quarters of all foreign divestment in the sector.

The selling is being chalked up to a strategic rotation. After a blistering rally in chip stocks, fund managers are shifting capital into other growth pockets – robotics names such as Doosan Robotics and energy-storage specialists like Samsung SDI. Yet underneath that surface turbulence, SK Hynix’s business fundamentals have rarely looked stronger.

Margins above 70% and a Wall Street debut in the works

The company posted a record operating profit of more than 37 trillion won in the first quarter of 2026, with revenue surging past the 52 trillion won mark. Operating margins reached 72%, a figure that prompted Wedbush Securities to add the stock to its exclusive “AI 30” index. Analyst Daniel Ives described the environment as an unprecedented supercycle, driven by hyperscalers racing to expand data centers and by the shift of AI workloads from training to inference – a transition that demands exponentially more memory.

Nomura Securities has more than doubled its price target for SK Hynix, lifting it from 2.34 million to a punchy 4 million won. “The supply-demand imbalance for HBM and DRAM chips gives manufacturers pricing power, and we expect another significant price jump in the second half,” the brokerage noted.

To fund new fabrication plants, management is preparing to list American depositary receipts on the New York Stock Exchange. A confidential filing is already believed to be in motion, and the deal could raise as much as $14 billion by the summer – one of the year’s largest cross-border equity offerings.

New leveraged products add volatility to the mix

From Wednesday, the Korea Exchange will list 18 new leveraged and inverse exchange-traded products linked to SK Hynix and Samsung. These instruments offer twice the daily return of the underlying shares, prompting regulators to flag the risk of extreme price swings. Retail investors must maintain at least 10 million won in their accounts and complete a mandatory training module before they can trade.

Mirae Asset analysts predict inflows of up to 5.3 trillion won into these products, which would further concentrate trading activity around the two chip giants. That could amplify both rallies and drawdowns in the coming months.

Physical expansion mirrors digital demand

While the trading floor buzzes with new products, the real economy is keeping pace. SK ecoplant, a construction affiliate, has reported a nearly 75% surge in revenue from its high-tech infrastructure unit, as builders race to erect the next generation of chip fabrication lines. The short-term capital flight from foreign funds does little to alter the long-term demand picture: AI is forcing the industry into a massive investment cycle, and the new capacity coming online over the next few quarters will determine growth for years.

Shares of SK Hynix ended the week at 1,941,000 won, just a hair below their all-time high. The stock rallied nearly 7% over the week, and on Friday alone it surged more than 11% as the US IPO news broke. The next resistance sits just shy of 2 million won – a level that, if breached, could open the door to fresh highs.