SK Hynix earnings beat sends Micron, Sandisk shares higher

SK Hynix (SKHY) stock soared 12% on Wednesday after third-quarter earnings demonstrated memory chip pricing that continues to rise to record levels. The Korean semiconductor's success has led to a rally in Micron (MU) and Sandisk (SNDK), its two primary US competitors in the memory chip space.

Micron stock jumped over 4% on the news, while Sandisk stock dug out of its recent slump to climb over 5%.

SK Hynix reported a record $104.6 trillion Korean Won ($77.9 billion) in quarterly revenue (up 32% QoQ), the first time it overcame the $100 trillion threshold. South Korea's KOSPI, the country's main equity benchmark index, surged over 6.6% on the news.

SK Hynix earnings show memory prices continue to rise

Micron and Sandisk investors are taking heart in the fact that the SK Hynix result demonstrates that memory prices are not leveling off.

The Korean producers DRAM segment saw revenue rise 10% QoQ while average selling prices surged in the "high-20%" range QoQ. Its NAND memory business saw a "slight decrease" in revenue from Q2 but also posted a mid-20% jump in average prices.

This is particularly significant for Sandisk, a NAND pure play, since it reports Q1 2027 earnings on Thursday, October 29. Wall Street expects Sandisk to report $46.41 in adjusted earnings per share (EPS) on $10.7 billion in revenue.

The small quarterly decrease in NAND revenue at SK Hynix should not be an issue for Sandisk since the former is heavily focused on shifting its production capacity to high-bandwidth memory (HBM) chips needed by AI data centers. In fact, it might mean that Sandisk is seeing its market share grow.

For the fourth quarter, SK Hynix expects its DRAM business to generate another 20%+ increase in QoQ revenue, while its NAND business should see revenue rise by mid-single digits.

Operating profit for the Korean memory maker jumped 38% QoQ and 632% YoY. SK Hynix said it planned to return about $75 billion to shareholders this year via dividends and share buybacks.

SK Hynix stock chart

SK Hynix only listed its shares on the NASDAQ in July, so there isn't much for technical analysts to grasp onto. But the fact that spiked about 25% in the past four trading days tells us that the market realized it was undervaluing the stock pretty severely.

Even before earnings, SKHY gapped up on both Monday and Tuesday. Now a break of the 50-day Simple Moving Average (SMA) near $169 seems like a foregone conclusion. Even in the near term, SKHY seems likely to retest past resistance in the $190 to $200 range.

Breaking above $200 is quite possible before year-end, but bulls are plenty aware that SKHY has already tried on four separate occasions in the past four months. This time hefty share buybacks should be enough to get bulls over the finish line.