SK Hynix Shares Drop 20% Amid AI Market Sell-Off

SK Hynix saw its share price decline 20.2% in October, falling victim to a broader market sell-off in semiconductor and artificial intelligence stocks. The downturn occurred despite the company reporting exceptional third-quarter financial results, including a 328% revenue increase to 104.6 trillion Korean Won and a 632% surge in operating profit.

Investors drove the sell-off based on concerns regarding the long-term sustainability of the AI build-out. Market volatility was triggered by leaked third-quarter revenue figures from AI lab Anthropic, which sparked fears that AI firms cannot generate enough revenue to cover their massive computing commitments.

Additional pressure on the stock came from macroeconomic uncertainty, including the U.S. midterm elections and rumors of renewed U.S. military operations in Iran. In response to its strong financial performance, SK Hynix management announced a year-end dividend of 20,000 Won per share.