Nvidia supplier SK Hynix reports 158% jump in Q1 profit on AI demand boost

SK Hynix Inc.’s operating profit jumped a bigger-than-expected 158%, helped by both a global race in AI and stockpiling ahead of US tariffs of both advanced chips and memory used in PCs and smartphones.

The Icheon, South Korea-based company on Thursday warned that macroeconomic uncertainty create volatility in demand in the second half of the year. But it kept its forecast for high-bandwidth memory HBM demand to double in 2025, citing supply agreements made with customers a year in advance.

In the March quarter, SK Hynix reported operating income of 7.44 trillion won ($5.2 billion), exceeding the projected 6.6 trillion won on a 42% rise in revenue. It marked the company’s second-highest quarterly performance and came on the heels of record revenue and operating profit in the prior quarter.

SK Hynix’s results highlight the scale of global data center investments and the company’s leading role in supplying HBM needed for Nvidia Corp.’s accelerators to train artificial intelligence.

The company is trying to outrun Samsung Electronics Co., which is focusing much of its considerable resources on taking market share away from its smaller Korean rival in the lucrative artificial intelligence memory market.

SK Hynix said sales of 12-layer HBM3E — a cornerstone of the company’s AI memory strategy — are expected to increase to account for more than half of total HBM3E revenues in the second quarter. That chip is currently the most advanced HBM on the market that works alongside Nvidia’s graphic processing units.

Tech providers around the world are bracing for slowdowns in demand throughout the supply chain, triggered by US tariff policies, however.

SK Hynix’s stock price is up just around 4% since the start of the year. Fears of a tariff-fuelled global recession as well as a re-evaluation of AI profitability in the face of DeepSeek’s low-cost models are denting momentum that had helped its shares more than double over the past two years.

The stock performance reflects the chipmaker’s vulnerability to any slowdown in AI spending and the Trump administration’s attempts to reset global trade relations. Should trade tensions tip economies around the world into recession, end-demand for all products containing chips is at risk of plummeting.

“Earnings season won’t matter with larger forces at work,” Morgan Stanley analysts led by Shawn Kim said in a note to investors this week. “The real tariff impact on memory resembles an iceberg, with most danger unseen below the surface and still approaching.”