Emergency Market Rescue After Stock Halves! SK Hynix to Buy Back $29 Billion; JPMorgan: Could Return at Least $130 Billion to Shareholders by 2027

South Korea's memory giant SK Hynix announced Wednesday (19th) that it will buy back shares worth 40 trillion won (approximately $29 billion) and fully cancel them, while upgrading its shareholder return policy for 2025–2027 from 'returning up to 50% of cumulative free cash flow' to 'over 50%'. In response, JPMorgan (referred to as 'JPM') analyst Jay Kwon estimated that, excluding already announced plans, the company could still return at least 180 trillion won (about $130 billion) to shareholders by 2027—equivalent to approximately 16% of its current market cap—potentially stabilizing its stock price amid recent sell-offs.

On Wednesday, SK Hynix stated that its current stock price does not adequately reflect its business competitiveness, cash-generating ability, or medium-to-long-term growth potential.

The urgency behind this market rescue is significant. From the beginning of the year to its peak on June 22, SK Hynix's South Korean shares surged 349%, but then plunged 48.61% in less than two months. On Tuesday (18th), its U.S. ADR also dropped 9.2% in a single day, bringing its market value down to $1.11 trillion.

In fact, SK Hynix had already signaled on August 7 that it was exploring additional shareholder returns, announcing on the same day a quarterly dividend of 375 won per share, totaling 273.3 billion won. Since a new labor agreement in September last year, SK Hynix has also established an annual performance bonus funded by 10% of operating profit.

While valuation corrections have occurred due to volatility in the AI memory market, the company is simultaneously binding shareholder interests by committing over half of its free cash flow to returns. SK Hynix is effectively converting the benefits of the HBM cycle into immediate market value through 'cancellation-style buybacks,' betting that investors believe in HBM’s long-term cash cow nature, which won’t change due to short-term stock declines.