SK Hynix, the world’s leading AI memory chipmaker, raised over $26 billion selling American Depositary Receipts priced at $149 each after its Korean shares more than tripled this year.
The ADRs opened 14% above the offer price at $170 before ending their first trading day at $168, setting the stage for dramatic swings in the sessions that followed.
Asian semiconductor stocks tumbled as a sell-off in U.S. chipmakers spilled into the region, with SK Hynix continuing to see massive volatility since its U.S. listing.
Shares of SK Hynix tumbled over 11% in Seoul, reversing the previous session’s 8% rally, as investors locked in profits amid growing worries over AI spending.
SK Hynix has become one of the market’s clearest proxies for the AI-memory trade, making it uniquely exposed to sentiment shifts across both its Seoul and Nasdaq investor bases.
A flood of new leveraged single-stock funds has added further turbulence, with Direxion launching the Direxion Daily SK Hynix Bull 2X ETF (SKHL), joining GraniteShares 2x Long SK Hynix Daily ETF (SKUU), GraniteShares 2x Short SK Hynix Daily ETF (SKDD), and ProShares Ultra SK Hynix (SKHU), all debuting this week.
David Russell, global head of market strategy at TradeStation, told MarketWatch that technology investors may have already “priced in years of growth,” helping explain why even strong earnings expectations are no longer enough to prevent violent profit-taking.
Lorraine Tan, director at Morningstar, warned that “despite accelerating artificial intelligence adoption, monetisation remains uncertain and profitability for key players, such as OpenAI, appears to be under pressure.”
Tan added that “funding is also shifting toward debt or equity, raising concerns about the maintainability of current spending levels,” reflecting broader caution spreading across the chip sector.
Ryu Young-ho, a senior analyst at NH Investment & Securities, said investors were profit-taking after the conclusion of the U.S. listing, while sentiment also suffered from caution regarding SK Hynix’s second-quarter earnings.
Ryu said investors had expected shipments of SK Hynix’s HBM4 chips to increase from the second quarter, but that the increase does not appear to have materialised at scale across the market.
He also noted that SK Hynix, with its greater exposure to the HBM market than rival Samsung, was set to benefit less from a recent rise in prices for conventional DRAM chips.
Louis Kondratev, trader at XFUNDs, noted the pullback reflects how crowded semiconductor trades have become, warning that “semiconductors alone now make up roughly 20% of the S&P 500, which is incredibly difficult to sustain.”
Kondratev noted that during the dot-com bubble of 2000, semiconductors were just over 8% of the index, and they have historically averaged between 2% and 5%, underscoring how stretched current valuations appear.
On the bullish side, SK Hynix CEO Kwak Noh-jung dismissed concerns about aggressive capacity expansion, forecasting that demand will continue to exceed the company’s ability to produce memory chips well into the next decade.
Kwak told Reuters that the memory industry is heading for its most severe supply shortage in 2027, with only limited improvement during 2028, while SK Hynix retains more than half of the HBM market.
