[Edaily Reporter Shin Ha-yeon ] While NVIDIA, the leading artificial intelligence (AI) semiconductor stock, continues to hit record highs, South Korea’s leading semiconductor stocks— SamsungElectronics(005930)and SK hynix(000660)—are stalling. This is despite expectations of record earnings, as concerns about the industry reaching its peak and short-term supply-and-demand pressures are weighing on investor sentiment. In particular, analysts suggest that SamsungElectronics’ stock price could become more volatile due to a confluence of factors, including the announcement of preliminary third-quarter earnings, exchange-traded fund (ETF) rebalancing, options expiration, and the conclusion of its share buyback program.

According to the financial investment industry on the 7th, NVIDIA closed at $239.20 on the New York Stock Exchange on the 6th (local time), up 0.14% from the previous trading day. During the session, the stock rose as high as $243.3, setting a new all-time high. It has now hit record highs for four consecutive days. Supported by expectations for AI semiconductor demand and a large-scale share buyback plan, the company is on track to surpass a market capitalization of $6 trillion (approximately 8,031 trillion won).

In contrast, SamsungElectronics closed at 272,000 won, down 1.45% from the previous day’s regular session, while SK hynix closed at 1,773,000 won, down 3.69%. As of 11:04 a.m. today, they are trading 0.28% and 2.09% lower, respectively. Their stock prices have also remained largely flat over the past month. Based on regular-session closing prices from the 7th of last month to the 6th of this month, SamsungElectronics rose only 0.74%, from 270,000 won to 272,000 won. During the same period, SK hynix fell 0.56%, from 1,783,000 won to 1,773,000 won. Despite expectations of record earnings, neither stock has been able to sustain a clear upward trend.

Both stocks underwent a correction after hitting their highs last June. SamsungElectronics reached a closing price of 374,500 won on June 19, and SK hynix rose to 2,987,000 won on the 25th of the same month, but their upward momentum stalled afterward. Their performance in the second half of the year has also been lackluster. Comparing closing prices at the end of June to those at the close of regular trading on the 6th of this month, SamsungElectronics fell 18.56% from 334,000 won to 272,000 won, while SK hynix dropped 33.09% from 2.65 million won to 1.773 million won.

Earnings and supply-demand dynamics are cited as key factors that will determine SamsungElectronics’ short-term stock price. In a report released on the 6th (local time), Heather Oh, an analyst in Goldman Sachs’ FICC and Equities division, predicted that volatility in SamsungElectronics’ stock price could increase on the 8th. This is due to a confluence of factors: the release of preliminary earnings, the possibility of mechanical selling resulting from adjustments to semiconductor ETF weightings, options expiration, and the conclusion of the company’s share buyback program.

According to Goldman Sachs, seven semiconductor ETFs with a combined AUM of approximately $14 billion will undergo rebalancing on the 8th. Analysts suggest that since SamsungElectronics’ weighting in these funds is nearing the maximum allowed for each fund, some selling pressure may emerge. The firm believes that some of the funds exiting SamsungElectronics are likely to flow into SK hynix, SKSQUARE(402340), ISUPETASYS(007660), WONIK IPS Co.,Ltd.(240810), and HANMISemiconductorCO.,Ltd.(042700). Furthermore, SamsungElectronics’ 15 trillion won share buyback program is expected to conclude around the 8th. As of the 6th, the program was 97% complete based on the purchase amount; once the buyback ends, the buying demand that has been propping up the stock price may diminish.

Earnings expectations were also lowered somewhat. Goldman Sachs revised its forecast for SamsungElectronics’ third-quarter operating profit downward from 112 trillion won to 106 trillion won. This reflects the fact that the average won-dollar exchange rate for the third quarter was 1,418 won, lower than the previous assumption of 1,460 won. However, the firm assessed that the fundamentals of DRAM and NAND remain strong. With HBM4 shipments gaining momentum, the firm projected that the bit-based shipment volume of High Bandwidth Memory (HBM) would increase by approximately 50% compared to the previous quarter.

Meanwhile, overall market profit expectations remain high. According to financial information provider FnGuide Inc., the consensus estimates for SamsungElectronics’ third-quarter consolidated operating profit, as presented by major domestic securities firms, totaled 106.9435 trillion won, while SK hynix’s stood at 77.2214 trillion won. The combined forecast for the two companies amounts to approximately 184 trillion won. The key points to watch during earnings season are whether the companies can meet these heightened expectations—along with the absolute scale of their profits—and whether they can maintain high profitability next year as well.

The securities industry continues to place emphasis on medium- to long-term profit resilience driven by the expansion of long-term supply agreements (LTAs) and growing demand for HBM. Han Dong-hee, an analyst at SKSecurities, stated in a recent report, “In the past, excessive orders driven by expectations of supply shortages led to volatility characterized by sharp price drops; however, recently, as the proportion of long-term supply agreements (LTAs) has expanded, distortions in demand signals have been significantly mitigated,” and “Even if the peak of earnings is somewhat lower, the period during which high profit levels are maintained has become much longer, creating a phase where cumulative cash generation is maximized.”

Diversification of HBM customers is another factor supporting profit resilience. Kim Young-geon, an analyst at MIRAE ASSET SECURITIES, stated, “We expect HBM demand to expand and customer diversification to occur in 2027.” He projected that memory demand for Alphabet and Amazon’s in-house AI chips, along with the launch of NVIDIA’s next-generation platform, will sustain strong HBM demand.

The return of foreign buying interest is also a key variable for SamsungElectronics. Goldman Sachs reported that foreign investors have been net sellers of SamsungElectronics for five consecutive trading days, offloading a total of $2.6 billion worth of shares. Analyst Oh pointed out, “The key factors to watch are whether foreign capital will flow back in and whether the company can maintain its strong earnings momentum and guidance.”