Battle of tech giants: How SK Hynix surpassed Samsung

2025 marked a turning point for the global semiconductor market. Against the backdrop of rapid expansion in artificial intelligence infrastructure, SK Hynix not only delivered record financial results but also overtook Samsung in profits within the memory segment — for the first time in many years. The key question now is whether this leadership is temporary or the beginning of a new technological cycle.

Record figures and new scale

By the end of 2025, SK Hynix reported an operating profit of 47.2 trillion won (around $33 billion) — an record in the company’s history. Revenue reached 97.15 trillion won, signaling a sharp rebound after a weak 2023 and confirming the recovery of the memory market.

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The fourth quarter was particularly telling: operating profit surged by more than 130% compared with the same period a year earlier, pointing not to a one-off effect but to sustained demand. Against this backdrop, Samsung — despite the scale of its business — fell behind its rival precisely in the memory segment, which is critical for AI infrastructure.

For investors, these figures sent a clear message: the memory market has entered a phase where the winner is not the biggest player but the one that adapts fastest to a new type of demand.

What exactly reshaped market

SK Hynix’s rise is directly linked to the boom in High Bandwidth Memory (HBM) — high-speed memory that is essential for training and running large language models, data centers, and AI accelerators.

Unlike traditional DRAM chips, HBM is a high value-added product with complex architecture and a limited number of suppliers. SK Hynix bet on this segment earlier than its competitors and managed to secure long-term contracts with key players in the AI market, including accelerator manufacturers.

As a result, the company’s revenue mix shifted: HBM became the main driver of margin expansion. This allowed SK Hynix not only to grow sales but also to sharply improve operating profit — something the market particularly values in an environment of high capital costs.

Samsung vs. SK Hynix: Leadership shift without illusions

It is important to stress that this is not a story of Samsung’s collapse. The corporation remains a giant with a highly diversified business, spanning smartphones to contract chip manufacturing. However, that very diversification became a constraint instantly when the market demanded narrow specialization and rapid reallocation of resources toward AI memory.

SK Hynix, by contrast, made a more «pure» bet on memory and AI. As a result, in 2025 the company overtook Samsung in operating profit within the DRAM and HBM segments — a scenario that seemed unlikely just a few years ago. Samsung is actively working on HBM4 and next-generation memory, but the market has already priced in SK Hynix’s current leadership, and closing the gap will not be easy.

Stocks and market reaction

Equity markets moved quickly to reflect this shift. By the end of 2025, SK Hynix shares had risen by more than 200%, making the company one of the top performers not only in South Korea’s KOSPI index but across the entire Asian technology sector. The company’s market capitalization more than doubled over the year, surpassing 150 trillion won, and it outperformed Samsung Electronics in stock performance despite its much smaller overall scale.

Investors increasingly viewed SK Hynix as a direct beneficiary of the AI race. According to the company’s annual report, revenue from HBM memory in 2025 more than tripled, while HBM’s share of total memory sales exceeded 30%, up from less than 10% a year earlier. Operating margins in the DRAM segment recovered to double-digit levels and in some quarters approached 25–30% — an unusually high range for the memory industry.

By contrast, Samsung shares rose much more modestly — by around 20–30% over the year — even though the company remains the world’s largest memory producer by volume. In 2025, Samsung posted a recovery in revenue and profit within its semiconductor division, but mass production of advanced HBM lagged competitors, and the contribution of AI memory to financial results remains lower than at SK Hynix. For the market, this became a key factor in reassessing expectations.

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As a result, SK Hynix has transformed from the traditional «number two» of South Korea’s semiconductor sector into a bellwether for the entire memory industry — especially in the context of AI. Its stock performance now reflects not so much the cyclical nature of the DRAM market as the pace of AI adoption in data centers and memory makers’ ability to monetize that demand faster than competitors.

Betting on scale and scarcity

Both companies have announced significant increases in capital expenditures for 2026, but their strategic priorities differ. SK Hynix is focusing investments on expanding production of high-performance memory (HBM3E and HBM4), as well as optimizing supply chains for major AI clients. According to the company’s official guidance, HBM3E and future HBM4 products are expected to be the main demand drivers in the memory market in 2026, forming the foundation of the so-called AI memory supercycle and allowing SK Hynix to strengthen its position in the premium HBM segment.

Samsung is also expanding capacity but is placing emphasis not only on HBM, but also on other memory types (DRAM, LPDDR, NAND) and technological improvements such as more advanced process nodes and planned HBM4 shipments. Both Samsung and SK Hynix have signed strategic agreements tied to major AI projects, including contracts to supply up to 900,000 DRAM wafers per month for OpenAI, underscoring the growing demand. At the same time, Samsung continues to prioritize competitiveness in standardized memory segments.

Against this backdrop, the key economic factor is persistent memory scarcity. According to SK Hynix forecasts, DRAM shortages could last until 2028, while constrained supply of conventional DRAM and its reallocation toward AI memory only intensify price pressure.

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Risks that cannot be ignored

Despite the optimism, the market remains cyclical. A slowdown in AI investment, technological breakthroughs by competitors, or geopolitical constraints could alter the balance of power. Scaling HBM production also requires enormous capital outlays and carries operational risks.

Investors are also closely watching whether overheating in the AI market could lead to excess capacity in 2027–2028 — a classic scenario for the semiconductor industry.

New cycle with a new leader

SK Hynix’s 2025 story illustrates how a technological shift can rapidly reshape the competitive landscape even in a mature industry. The company embedded itself into the AI value chain earlier than rivals and was rewarded with record profits and market confidence.

For investors, the signal is clear: the era of universal semiconductor giants is gradually giving way to specialized players capable of monetizing key technological trends. AI memory has become such a trend — and it is precisely this shift that propelled SK Hynix into the lead.