SK Hynix tumbles more than 6% Monday, following successful US debut last week
SK Hynix tumbles more than 6% Monday, following successful US debut last week.
SK Hynix ( SKHY ) fell more than 6% in early trading on Monday, following the broader tech industry, after posting a roughly 13% gain in its US market debut on Friday.
Stock of the chipmaker was trading at $157, down from the $168 they closed at on Friday, but above their $149 offer price.
The initial public offering (IPO) consisted of 177.9 million American depositary receipts (ADRs), each representing one-tenth of a share of the company's common stock, or 17.79 million shares. All totaled, SK Hynix raised $26.5 billion in its IPO.
The company's South Korea-listed stock, which trades on the Korea Exchange, has skyrocketed over the past year thanks to the incredibly high demand for memory and storage chips driven by the global AI data center build-out.
AI data centers use high-bandwidth memory (HBM) and storage chips to hold and pass data to the specialized AI accelerators, making the essential components for running AI models.
But the global AI data center buildout has created a shortage of those chips, which is bleeding into the consumer electronics industry, forcing companies like Microsoft and Apple to raise the price of devices including laptops and tablets.
Three major companies make HBM and storage: Micron ( MU ), Samsung ( 005930.KS ), and SK Hynix, which captures 56.4% of the market.
To meet improve supply SK Hynix says it will use the funds it raised in its IPO to build out new manufacturing facilities. But constructing those plants takes years.
The memory business is prone to boom and bust cycles. But companies are hoping this time will be different.
During its recent earnings call, Micron announced that it is signing customers to long-term strategic customer agreements, in which clients commit to purchasing a specified quantity of Micron's chips each year over the course of the contract, with a large up-front cash payment.
Micron chief business officer Sumit Sadana told Yahoo Finance at the time that most of those agreements run for five years, whereas prior memory agreements lasted just one year.
Email Daniel Howley at dhowley@yahoofinance.com. Follow him on X at @DanielHowley .
Click here for the latest technology news that will impact the stock market .
Read the latest financial and business news from Yahoo Finance
Sinergia Empresarial continuará el seguimiento de esta información sobre sK Hynix tumbles more than 6% Monday, following successful US debut last week y ampliará la cobertura conforme se confirmen nuevos elementos relevantes para el ecosistema empresarial.
