SK Hynix to Buy Back and Cancel 40 Trillion Won ($28.61 Billion) in Shares as AI Chipmaker Boosts Investor Returns

SK Hynix announced Wednesday, August 19, 2026, that it will buy back and cancel 40 trillion won worth of shares. That figure equals approximately $28.61 billion at current exchange rates. The board approved repurchasing 24.07 million common shares, about 3.3% of total shares outstanding. This marks the largest treasury share cancellation ever by a South Korean listed company. 

SK Hynix’s American Depositary Receipts surged more than 8% in overnight trading following the announcement.

SK Hynix Buyback Timeline and Execution Details

SK Hynix (NASDAQ: SKHY) will begin repurchasing shares Thursday, August 20, 2026, through open-market purchases. The buyback program runs for approximately three months, concluding by November 19, 2026.

• Shares will be bought at 1.66 million won each, based on Tuesday’s closing price.
• SK Hynix has 730,492,365 total issued shares currently outstanding.

All repurchased shares will be permanently cancelled once the buyback program completes. That cancellation reduces total share count, directly boosting per-share value for remaining SK Hynix shareholders going forward.

Why SK Hynix Is Expanding Shareholder Returns Now

SK Hynix said its “intrinsic value” isn’t fully reflected in its current stock price. That assessment drove the board’s decision to accelerate shareholder return commitments significantly.

• The company raised its shareholder return target from “within 50%” to “over 50%” of cumulative free cash flow.
• This expanded target covers free cash flow generated between 2025 and 2027.

SK Hynix’s free cash flow reached 24.8 trillion won in 2025, according to market tracker FnGuide. Brokerages now project that figure surging to 146 trillion won in 2026, then 240 trillion won in 2027.

SK Hynix Unveils $28.6B Buyback, Shares Surge

📈 $SKHY announced a $28.6 billion share buyback, its largest ever, sending shares up over 10% from overnight lows.

💰 The move comes as SKHY looks to return capital after a strong run in memory chips, with the buyback set to… pic.twitter.com/nQoNGfk8az

— Financier.news (@FINANCIERNEWS) August 19, 2026

Investor Pressure Mounted After June’s Record Highs

This buyback announcement follows growing investor pressure on both SK Hynix and rival Samsung Electronics. Both companies hit record stock highs in June 2026 before pulling back sharply.

• Investors questioned why AI memory chip profits weren’t translating into bigger capital returns.
• Concerns about AI spending durability also weighed on both chipmakers’ share prices.

SK Hynix’s net cash position stood at approximately 69 trillion won as of the end of Q2 2026. That substantial cash cushion gives the company flexibility to fund both buybacks and future dividend increases simultaneously.

What This Means for South Korea’s Chip Sector

SK Hynix’s move aligns directly with South Korea’s broader “Value-up Program,” designed to boost shareholder returns nationwide. If the company delivers on its 50%-plus FCF pledge, total shareholder returns could exceed 200 trillion won through 2027.

SK Hynix also said it’s considering higher regular dividends alongside potential special dividend payments. Samsung Electronics now faces similar pressure to detail its own capital return plans following this announcement. Global memory rival Micron Technology continues competing directly with both Korean chipmakers in the booming AI memory market.

Final Thoughts

This 40 trillion won buyback signals genuine confidence in SK Hynix’s long-term cash generation capacity, backed by record AI memory demand. With Samsung Electronics now facing pressure to match this commitment, South Korea’s chip sector could see broader shareholder-friendly policy shifts. Investors should watch whether SK Hynix follows through on its expanded dividend considerations over the coming quarters.

Disclaimer:

The content shared by Meyka AI PTY LTD is for research and informational purposes only. Meyka is not a financial advisory service, and the information provided should not be treated as investment or trading advice.