SK Hynix slides 5% as Samsung climbs, splitting Korea's AI trade

SK Hynix fell nearly 5 percent Friday, extending a two-day slide past 15 percent, while Samsung rose 0.8 percent in a rare split between Korea's AI memory leaders.

"Short positioning had become sufficiently one-sided for any stabilisation in AI sentiment to trigger a short-covering rally," David Chew, an analyst at Citi, told MarketWatch.

The divergence caps a volatile week. SK Hynix's US-listed shares jumped 8.2 percent to $153.38 on Tuesday after at least six brokerages launched Buy-equivalent coverage, including William Blair's $260 target and Rosenblatt's $320 objective. The stock then reversed sharply, with Thursday's 10.4 percent plunge in Seoul erasing most of those gains. Samsung, by contrast, rose nearly 4 percent on Wednesday and held gains through Friday.

The split reflects growing differentiation in how investors value the two companies' AI memory exposure. SK Hynix holds a dominant position in high-bandwidth memory supplied alongside Nvidia accelerators, but its premium valuation leaves less room for disappointment. Samsung's broader DRAM scale offers cheaper exposure to the memory upcycle, even as it lags in premium HBM qualification.

Competing visions at FMS

The divergence comes days after both companies presented competing AI memory roadmaps at the Future of Memory and Storage conference in Santa Clara. Samsung unveiled concept-stage technologies including zHBM, a vertical stacking architecture that places memory directly on top of AI accelerators, claiming up to eight times the performance of HBM5. The company also revealed V10 Bonding V-NAND, the industry's first wafer-bonded NAND design exceeding 400 layers, and zNAND-O for edge AI systems.

SK hynix, by contrast, arrived with technologies closer to deployment. The company and SanDisk published the industry's first open specifications for High Bandwidth Flash through the Open Compute Project, backed by Google and AI chip startup Tenstorrent. HBF is designed to sit between ultra-fast HBM and conventional solid-state drives for terabyte-scale AI inference workloads. SK hynix also showcased its 375-layer V10 4D NAND, with enterprise SSD mass production scheduled for early 2027.

Valuation gap widens

Moody's upgraded SK Hynix's debt rating to A3 from Baa1, citing strong profitability and cash generation over the next 12 to 18 months. The company posted a record $42 billion second-quarter profit, yet investors have responded by selling, suggesting the market is pricing in a peak in the memory cycle.

The Kospi pushed more than 5 percent higher on Wednesday as foreign investors and institutions were net buyers, but the rally has since faded. SK Hynix's two-day decline of more than 15 percent has erased most of the gains from the analyst coverage wave, while Samsung's more modest moves reflect its position as the cheaper memory beta within Korean chips.

For investors, the divergence raises a question: whether SK Hynix's premium valuation for HBM leadership is justified, or whether Samsung's broader memory exposure offers better risk-adjusted returns as the AI memory cycle matures.

This article is for informational purposes only and does not constitute investment advice.