SK Hynix launches $28.6 billion share buyback and cancellation

SK Hynix launches $28.6 billion share buyback and cancellation

Wed, August 19, 2026 at 3:12 PM GMT+3 2 min read

• SKHY -9.20%

SK Hynix approved a plan on Wednesday to repurchase and cancel 40 trillion won ($28.6 billion) of its own shares, marking the largest treasury share cancellation in the history of South Korean listed companies.

The board resolution covers roughly 24.07 million shares, or about 3.3% of the company's total shares outstanding, based on the closing stock price of 1,662,000 won on the day before the vote, the company said. The repurchase period runs from Aug. 20 through Nov. 19, with all acquired shares to be canceled upon completion.

SK Hynix also said it intends to revise its shareholder return commitment for 2025–2027 upward, moving the benchmark from a ceiling of 50% of cumulative free cash flow to a floor exceeding that level. Returns will be delivered through a combination of share repurchases, cancellations, and cash dividends, including fixed and special dividends under consideration. The company said specific details on additional returns will be announced alongside its third-quarter earnings release.

The company said it believes the market is undervaluing the stock relative to its fundamental worth, pointing to the strength of its competitive position, capacity to generate cash, and prospects for growth over time. As of the end of the second quarter, SK Hynix held net cash of approximately 69 trillion won, the company said.

SK Hynix shares dropped 9.75% on Wednesday, recovering only partially by the close of after-hours trading, according to Reuters. The stock has more than doubled this year despite that decline.

The chipmaker, which supplies high-bandwidth memory chips to Nvidia, has been under increasing investor pressure to distribute more of its swelling cash holdings, given the record earnings it has generated from AI-driven memory demand, according to Reuters. Samsung Electronics faces similar investor pressure.

SK Hynix approved 54 trillion won in investments last week to build two new fabrication plants in South Korea — one for DRAM in Yongin and one for NAND flash in Cheongju — as the company pursues one of the semiconductor industry's most aggressive capacity expansion programs. The company is balancing those outlays against shareholder returns and employee bonuses; in 2025 it reached a deal to distribute 10% of yearly operating profit to its workforce, with the arrangement locked in for a decade.

Earlier this year, SK Hynix listed American depositary receipts on the Nasdaq, raising $26.5 billion in the largest U.S. share sale ever completed by a foreign company, with each underlying common share represented by ten ADRs.