【US Pre-Market】SK Hynix’s $75 Billion Return Plan Boosts Memory Stocks, SKHY Up About 8%; Fed Decision and Microsoft, Google Earnings in Focus

SK Hynix (SKHY) rose over 8% in pre-market trading as its financial results hit a record high and it announced an approximately $75 billion shareholder return plan.

SK Hynix's third-quarter earnings report released on October 28 showed that the company's revenue reached 104.62 trillion Korean won (approximately $78.86 billion), up 327.9% year-over-year; operating profit reached 83.33 trillion Korean won, up 632.1% year-over-year, with both metrics setting all-time highs.

The company stated that AI infrastructure investments are driving demand growth for HBM and server memory, and expects tight supply-demand conditions for memory chips to possibly persist through 2030.

Regarding shareholder returns, the company plans to return approximately 100 trillion Korean won to shareholders in 2026, including cash dividends and share buybacks. SK Hynix also stated that long-term agreements signed with 14 major customers have covered more than half of its production capacity for 2027 and 2028, providing a degree of visibility for future demand.

Boosted by SK Hynix's financial results and buyback plan, Micron (MU) rose over 4% in pre-market trading, while SanDisk (SNDK) gained over 4%.

NXP Semiconductors (NXPI) fell over 7% in pre-market trading as its fourth-quarter earnings guidance missed expectations.

NXP's third-quarter revenue grew 19% year-over-year to $3.79 billion, and adjusted earnings per share reached $4.20, both topping market expectations. However, the company expects fourth-quarter revenue of $3.75 billion to $3.95 billion, with the midpoint of the range slightly below market expectations; adjusted operating profit guidance also fell short of analysts' expectations. The weak profit outlook offset the positive momentum from third-quarter results beating expectations, putting pressure on the stock price.

Seagate Technology (STX) dropped over 3% in pre-market trading, with strong financial results failing to boost the stock price.

Seagate's fiscal first-quarter 2027 revenue grew 61% year-over-year to $4.233 billion, and non-GAAP adjusted earnings per share reached $7.68, beating market expectations of $7.45. The company expects fiscal second-quarter revenue of $4.7 billion to $4.9 billion, and adjusted earnings per share of $9.00 to $9.40, both above market expectations.

Despite the strong performance and guidance, the stock price still declined, likely reflecting that prior gains had already priced in growth expectations, as well as investor concerns over hard drive industry competition, cost pressures, and the sustainability of future demand.

Fed releases interest rate decision as market focuses on inflation and future rate cut signals.

The Federal Reserve wrapped up its two-day policy meeting on October 28 and is scheduled to announce its interest rate decision at 2:00 p.m. With interest rates expected to remain unchanged, investors are focusing more on the policy statement and the chairman's press conference for insights on inflation, economic growth, and the future rate path.

If the Federal Reserve expresses stronger concerns over inflation, bond yields could rise, putting pressure on high-valuation tech stocks; if the policy aligns with expectations, market focus may shift back to corporate earnings and AI investment returns.

Microsoft and Alphabet to report earnings after hours, with focus on whether AI capex can deliver returns.

Microsoft and Alphabet are expected to report their quarterly results after the market close on October 28. Attention will center on Microsoft's Azure cloud growth, Copilot commercialization, and data center capex. Meanwhile, Alphabet faces tests regarding Google Cloud growth, AI product monetization, and returns on infrastructure investments.

As big tech companies continue to expand AI infrastructure investments, market expectations for performance are extending from demand growth to profitability and cash flow. The financial results and management guidance released by both companies may also influence market expectations for Nvidia (NVDA), AMD (AMD), Broadcom (AVGO), and memory chip companies.

OpenAI reportedly plans to purchase Google AI chips to reduce reliance on Nvidia.

According to a report by The Information, OpenAI plans to procure Google's self-developed Tensor Processing Units (TPUs) to diversify its AI computing power sources. The report did not disclose the procurement volume, financial value, or specific terms of the potential deal. Reuters reported that Google did not immediately respond to a request for comment at the time, while OpenAI declined to comment.

OpenAI is a major customer for Nvidia's GPUs. If the procurement plan comes to fruition, it will help Google expand its TPU business and potentially intensify competition in the AI chip market. However, it remains too early to gauge the actual impact of this plan on Nvidia's orders and market share.

This content was translated using AI and reviewed for clarity. It is for informational purposes only.