SK hynix Tops Nvidia With 72% Operating Margin

*Editor's Note: 'AI PRISM' (Personalized Report & Insight Summarizing Media) is an 'AI-based personalized news recommendation and summary service' developed with support from the Korea Press Foundation. It selects and provides six customized news articles by reader type.

1. Dream Operating Margin of 72%… SK hynix Takes Global No. 1 Spot

- Key Summary: SK hynix recorded first-quarter revenue of 52.58 trillion won and operating profit of 37.61 trillion won, surging 198.1% and 405.5% year-on-year respectively, with operating margin reaching an all-time high of 71.5%. Soaring prices of DRAM, HBM and NAND flash driven by expanding AI infrastructure investment led to the vertical rise in earnings. Kim Ki-tae, vice president of SK hynix, said "market demand over the next three years will exceed our production capacity." With full-scale shipment of high-value-added HBM4 starting in the second half and the financial investment industry forecasting second- and third-quarter operating profits to surpass 60 trillion won and 70 trillion won respectively, the earnings upward trajectory remains intact. The possibility of large-scale share buybacks and cancellations under the policy of returning 50% of free cash flow (FCF) to shareholders is also cited as an additional share price catalyst.

2. Hyundai Motor Posts Record Q1 Revenue of 46 Trillion Won, but 860 Billion Won Tariff Cuts Operating Profit 30%

- Key Summary: Hyundai Motor achieved record first-quarter revenue of 45.94 trillion won, yet operating profit plunged 30.8% year-on-year to 2.51 trillion won due to 860 billion won in U.S. export tariffs and rising raw material prices from the Middle East war, clearly revealing the real-world impact of the tariff blow. Hybrid vehicle sales hit a quarterly record, and global market share rose from 4.6% to 4.9%, indicating that fundamental indicators maintained solid trends. Hyundai Motor activated a contingency plan that fundamentally reviews overall spending while pursuing electrification, expansion of high-value-added models and region-specific strategies. Quarterly dividend was maintained at 2,500 won per share, unchanged from a year earlier, in line with the value-up program.

3. "KOSPI to Reach 8,000 on Semiconductor Boom… Undervalued PER Provides Ample Upside"

- Key Summary: Lim Tae-hyuk, head of the ETF management division at Samsung Asset Management, projected that the KOSPI could reach 8,000 points based on the semiconductor boom. The calculation shows that even applying Korea's forward PER peak (10.4x) alone, a KOSPI breakthrough of 8,000 is possible compared with Japan (PER 16x) and Taiwan (18x), analyzing that market valuation methods are shifting from PBR to PER-centered. Beyond semiconductors, upward momentum overlaps across shipbuilding, defense, nuclear power, securities, finance, autos and construction, leading to projections that sector rotation will continue after the KOSPI breaks its previous high. Lim emphasized, "Barring external variables, this is a time when aggressively expanding the domestic stock investment ratio is acceptable."

4. Semiconductors Overcome War Headwinds… Q1 GDP Surprise Growth of 1.7%

- Key Summary: The Bank of Korea reported first-quarter GDP growth of 1.7%, double its own forecast (0.9%) and the highest in five years and six months since the third quarter of 2020 (2.2%). Net exports contributed 1.1 percentage points to growth, overwhelming domestic demand (0.6 percentage points). A Bank of Korea official explained that "first-quarter earnings of the two leading semiconductor companies approached the level of last year's annual results." Investment indicators also improved, with semiconductor facility investment rising 4.8% quarter-on-quarter and construction investment rebounding 2.8%, but government consumption growth stayed at just 0.1%, with limited fiscal capacity pointed out as a variable for future growth. Choi Kyu-ho, economist at Hanwha Investment & Securities, projected "exports and investment will generally show solid trends."

5. KB Cancels Record 2.3 Trillion Won in Treasury Shares… Accelerates Value-Up

- Key Summary: KB Financial Group (105560) resolved to cancel all of its 2.24 trillion won worth of treasury shares, the largest single cancellation ever, on the 15th of next month. Including pre-purchased volume, the total second-quarter cancellation amount reaches 2.86 trillion won. First-quarter net profit was 1.89 trillion won, up 11.5% year-on-year, and the non-banking segment's profit share reached an all-time high of 43%, clearly demonstrating revenue diversification. Dividend per share (DPS) rose 25.3% to 1,143 won from 912 won a year earlier, more than double the 500 won in the first quarter of 2022, indicating an accelerating pace of shareholder returns. The direct trigger for the cancellation was the third amendment to the Commercial Act restricting treasury share holdings. KB Financial chose immediate cancellation despite an 18-month grace period, earning assessments that it has raised the bar for value-up standards in the financial industry.

6. 'Premium Strategy' Works… LG Display Operating Profit Quadruples

- Key Summary: LG Display recorded first-quarter operating profit of 146.7 billion won, surging 338.4% from 33.5 billion won a year earlier, marking the largest first-quarter profit since 2021. OLED revenue share rose 5 percentage points year-on-year to 60%, while panel price per area jumped 55% over the same period, with expanding demand for small- and mid-sized OLEDs in IT devices, including preparations for Apple's OLED MacBook launch, emerging as a growth driver. Despite the recovery in profitability, uncertainty has heightened for the second half due to chipflation and surging raw material and fuel costs stemming from the Middle East war. The company is accelerating its transition to an OLED-centered structure by pursuing annual facility investment in the mid-to-high 2 trillion won range and restructuring measures including voluntary retirement in the LCD segment.