SK Hynix announced a major share buyback worth up to 40 trillion won, or about $28.3 billion, as the memory chip maker moves to return more of its AI-driven profits to shareholders.
Shares of NYSE-listed SK Hynix (NASDAQ: SKHY) jumped following the announcement, reflecting a positive investor reaction to the company’s expanded capital return plans.
SK Hynix Approves Massive Share Buyback
The company said its board approved the buyback on Wednesday.
The program is scheduled to begin on August 20 and will run for approximately three months, according to a regulatory filing with the Korean exchange.
SK Hynix plans to repurchase more than 24 million treasury shares during the period.
The transaction ranks among the largest share buyback programs ever announced by a South Korean company.
AI Boom Fuels Stronger Shareholder Returns
The decision follows several quarters of strong earnings driven by rising demand for memory chips used in artificial intelligence infrastructure.
SK Hynix has been one of the major beneficiaries of the AI investment boom, particularly as demand for high-performance memory products has accelerated.
The company had previously committed to increasing shareholder returns as profits expanded.
Shareholder Return Target Raised Above 50%
SK Hynix also announced a higher shareholder return target.
The company now plans to return more than 50% of cumulative free cash flow to investors, up from its previous target of less than 50%.
This change highlights management’s confidence in the company’s cash generation and its willingness to distribute a larger portion of profits to shareholders.
Samsung Could Follow a Similar Strategy
Investor attention is also turning to rival Samsung Electronics, which has benefited from strong AI-related semiconductor demand.
Samsung could potentially pursue similar shareholder return measures as South Korea’s major chipmakers continue to generate significant cash from the global AI investment cycle.
Buyback Could Support SK Hynix Shares
The $28.3 billion buyback may also provide support for SK Hynix shares during a period of increasing uncertainty around AI-related stock valuations.
Despite recent volatility, SK Hynix shares have still gained more than 120% in 2026.
However, the stock had fallen around 15% over the previous month, as investors questioned whether elevated valuations across the AI sector could be sustained over the longer term.
A large buyback can reduce the number of shares available in the market and may help support earnings per share and investor confidence.
Memory Chip Demand Expected to Remain Strong
SK Hynix remains optimistic about the outlook for the semiconductor industry.
The company expects the main factors that supported its recent rally, including tight memory chip supply and strong demand, to continue over the coming years.
Persistent demand from AI data centers and other high-performance computing applications could therefore remain an important growth driver.
SK Hynix Outlook Remains Tied to AI Demand
The buyback signals that SK Hynix is increasingly using its AI-driven cash flow to reward shareholders.
At the same time, the company remains exposed to broader questions surrounding AI valuations, semiconductor demand and the sustainability of the current technology investment cycle.
Investors will continue watching memory chip prices, AI infrastructure spending and future shareholder return announcements for further clues about the outlook for SK Hynix stock.
