SK hynix (SK hynix (SKHY)) is having a rough week. The memory chipmaker's stock fell more than 3% in Tuesday's premarket session, extending Monday's 7.47% drop, as investors continued to exit artificial intelligence-linked semiconductor stocks ahead of the company's quarterly earnings. The world's second-largest memory chipmaker is scheduled to report second-quarter 2026 results on Wednesday, July 29.
The stock has gone from one of the hottest AI memory trades to a major test of investor confidence. Concerns over crowded positioning, Chinese competition, and hyperscaler spending are weighing on the sector.
The weakness came amid another risk-off session for technology shares. Nasdaq futures fell about 0.7%, while S&P 500 futures edged lower. Micron Technology (Micron (MU)) also dropped more than 4% in premarket trading.
AI Memory Trade Faces Pressure
SK hynix shares have plunged nearly 47% from their June peak, wiping out almost $600 billion in market value in a little over a month. The sell-off accelerated after reports of Chinese progress in deep-ultraviolet lithography machines raised fears of new memory capacity, while broader doubts over the AI rally hit chip stocks.
Andy Wong of Pictet Asset Management said investors are debating whether memory makers are capturing too much of the AI supply-chain economics. "The market wants to see whether anything changes the perception that SK Hynix is extracting excessive margin from customers," he said.
Kim Minji, a portfolio manager at Must Asset Management, told Bloomberg that SK hynix's earnings alone may not provide much of a catalyst. She said investors will focus more on whether the company boosts shareholder returns, including buybacks, and whether large hyperscalers keep raising capital spending.
Shawn Oh of NH Investment & Securities sees a buying opportunity. He told Bloomberg that SK hynix is a compelling buy, citing attractive valuation and deleveraging by Korean retail investors, though he noted some investors are cutting exposure ahead of U.S. tech earnings season.
Price Action
SK hynix shares were down 4.80% at $136.17 during premarket trading on Tuesday.
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