SK hynix shares advanced 3.6% in pre-market trading on Wednesday after the South Korean memory chipmaker unveiled a 40 trillion won ($28.3 billion) share buyback and cancellation program.
The board-approved initiative, set to commence on August 20, will repurchase more than 24 million shares over approximately three months, with all repurchased shares permanently retired. Management cited the current stock price as undervaluing the company’s fundamentals.
The program follows a 5.6% decline in the prior session, which was triggered by reports of potential US pressure on South Korea to prioritize domestic memory chip production as part of a broader $350 billion investment pledge. The South Korean presidential office denied these reports but did not disclose details of ongoing negotiations.
In addition to the buyback, SK hynix committed to directing more than 50% of its cumulative free cash flow generated between 2025 and 2027 toward shareholders, an increase from its prior policy capped at 50%. The company has framed this as part of a broader capital return framework aimed at enhancing shareholder value.
The announcement comes amid a neutral US market backdrop, with the S&P 500 and Dow Jones Industrial Average posting marginal gains while the Nasdaq edged slightly lower. Investors are awaiting the release of Federal Reserve meeting minutes for further policy signals.
