South Korea's SK Hynix on Thursday posted a record quarterly profit as the Nvidia supplier saw strong sales of advanced chips such as high-bandwidth memory (HBM) used in generative artificial intelligence chipsets.

Shares of Micron (NASDAQ:MU) are down about 3.5% on the day. About This Article  Shares of Micron are down about $4.50 on the day thanks to Nvidia supplier, SK Hynix. Granted, SK Hynix did post a record quarterly profit.

Nvidia stock rose modestly early Friday as investors digested a raft of mixed news over the past few days. Shares were up 0.1% to $147.34 in premarket trading. It closed almost flat Thursday after starting the day in the red as a fresh outlook from supplier SK Hynix cast doubt over future demand for its products.

SK Hynix Inc., a major supplier of memory chips, has announced record quarterly earnings. However, investors have reacted cautiously. Concerns about smartphone demand and future AI spending have tempered enthusiasm.

South Korea’s SK Hynix, one of the world’s largest memory chipmakers supported by strong sales of high bandwidth memory (HBM) used in generative AI.

Industry sources indicate that thermal issues associated with GB200 have prompted major clients including Microsoft, Amazon, Google, and Meta to reduce their orders, impacting not only Nvidia's product sales and revenue but also creating significant implications for its primary HBM supplier,

HBM chips a key component of AI processors, with SK Hynix serving as a major supplier to AI giant NVIDIA Corporation (NASDAQ: NVDA ). The company has greatly benefited from a ramp-up in AI demand over the past two years, with its investments in increased capacity and advanced chip production now bearing fruit.

The result compared with an 8 trillion won average forecast by LSEG SmartEstimate, which is weighted toward analysts who are more consistently accurate. SK Hynix's quarterly opera

The company’s Q4 revenue increased by 12%, and its operating profit rose by 15%, making for its best quarter ever, SK Hynix said in a statement. The company also announced that its revenue for the year was 66.1930 trillion won (roughly $46.13 billion). SK Hynix raised its annual fixed dividend for shareholders by 25%.

This year’s 30% AI-driven rally in shares of South Korea’s SK Hynix Inc. faces threats as political issues and valuations push local investors toward domestic-focused companies.Most Read from Bloomber

SK Hynix still finds strong demand for AI-related chips even with uncertainty ahead. However, experts caution that artificial intelligence expansion may slow down in 2025, hence lowering the difference between consumer-oriented and AI-oriented semiconductors.