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SK Hynix’s stock price soared more than 12% in the Seoul market on Thursday after the company announced a large-scale share buyback.
The company said it seeks to increase shareholder returns to more than 50% of cumulative free cash flow generated from 2025 to 2027, while accelerating its 40 trillion won ($28.7 billion) share buyback and cancellation program.
“We expect this initiative to act as a meaningful downside for the stock and provide tangible downside support in the near term,” said Peter Lee, an analyst at Citi. Lee added that the share buyback reflects confidence in SK Hynix’s medium- to long-term growth prospects, despite the current headwinds in the memory sector.
The news comes after the company announced earlier this month that it would invest 54 trillion Korean won in building a new memory chip manufacturing factory amid growing demand for components essential to artificial intelligence.
Meanwhile, other Asian tech stocks also rose, recovering from the previous day’s decline. Rising U.S. stocks supported market sentiment as long-term U.S. Treasury yields fell from multi-year highs, ending a three-day losing streak.
In South Korea, Samsung Electronics rose 8.69% and Kakao rose 4.41%.
In Japan, SoftBank Group rose 3.79%, and Nintendo also rose more than 3%. Rakuten added 2.39%.
Volatility in tech stocks has increased in recent trading as South Korea’s semiconductor-heavy market has been swinging between sharp declines and gains.
