ICHEON, South Korea — SK Hynix CEO Kwak Noh-jung announced a bold financial strategy on Wednesday, pledging to amass over 100 trillion won ($75 billion) in net cash to ensure the chipmaker can sustain aggressive investments regardless of market volatility.
Speaking at the 78th Annual General Shareholder Meeting held at the company’s headquarters in Icheon, Kwak emphasized that robust financial health is a prerequisite for dominating the Artificial Intelligence (AI) era.
"To strengthen our financial stability, we aim to secure a net cash balance of 100 trillion won or more," Kwak told shareholders. "This will provide us with the fundamental base to execute long-term, strategic investments under any economic circumstances."
The AI Pivot and Infrastructure Race
Kwak diagnosed that the global semiconductor industry has entered a "transformative turning point" driven by the explosion of AI. He projected that the expansion of AI data centers, inference services, and on-device AI would catalyze demand not only for High Bandwidth Memory (HBM) but across the entire DRAM and NAND flash sectors.
"In the AI era, memory performance and supply capacity will determine a company's ultimate competitiveness," Kwak noted. He reaffirmed the company's commitment to maintaining its leadership in the HBM market while pioneering next-generation memory technologies.
Shareholder Concerns over Dilution
While the CEO focused on growth, the meeting saw pointed questions from shareholders regarding the company's capital management and shareholder returns.
Some investors expressed skepticism over the 100 trillion won goal, suggesting that such a massive cash pile should instead be used for immediate shareholder rewards. Concerns were also raised regarding the potential dilution of shares tied to the company's push for a U.S. American Depositary Receipt (ADR) listing.
"With operating profits exceeding 40 trillion won, we expected special dividends," one shareholder remarked. "The current dividend level falls short of our expectations."
Striking a Balance
In response to concerns about the U.S. ADR listing, the company stated that specific terms are yet to be finalized and that market conditions would be carefully weighed.
Kwak concluded by promising to balance growth with shareholder value. "Last year, we implemented shareholder returns totaling 14.3 trillion won. This year, we will continue to expand our return policies, including dividends and share buybacks, in light of our performance and cash flow."
He described the massive cash target as "an insurance policy against uncertainty" and a vital asset for future growth, vowing to maintain a "delicate balance between investment, financial stability, and shareholder returns."
[Copyright (c) Global Economic Times. All Rights Reserved.]
