Cash piles up at Samsung and SK amid AI boom, raising expectations for dividends and share buybacks
The AI semiconductor boom is rapidly increasing Samsung Electronics’ and SK hynix’s cash resources. Securities firms expect the cash on hand to be likely used for shareholder returns, including special dividends, share buybacks and cancellations, and the issuance of American depositary receipts (ADRs).
As the artificial intelligence (AI) semiconductor supercycle gathers momentum, expectations are growing that Samsung Electronics and SK hynix will expand shareholder returns. 2Securities firms expect the two companies’ cash-generating capacity to improve significantly as AI demand expands. These estimates include company-specific projections for increases in free cash flow and net cash.
Samsung Electronics’ annual free cash flow (FCF) is expected to expand this year to 200 trillion to 300 trillion won. Securities firms say that improving memory market conditions and a recovery in the foundry business will support Samsung Electronics’ increased cash generation. In addition to the current shareholder return policy, the market is discussing the possibility of special dividends and additional share buybacks.
SK hynix’s net cash last year was reported to be 19 trillion won. This year, it is expected to surge to 156 trillion won. Some estimates suggest that in 2027, net cash will rise to 374 trillion won.
The securities industry expects the substantial cash generated to be used for shareholder returns, including special dividends, share buybacks and cancellations, and the issuance of American depositary receipts (ADRs). For individual companies, there are expectations that additional measures may accompany existing shareholder return policies. The specific dividend amounts and share buyback plans should be confirmed through each company’s disclosures.
From an investor’s perspective, free cash flow figures need to be checked in relevant disclosures and quarterly earnings announcements. Corporate capital allocation decisions may trigger an immediate share price reaction when disclosed. Future disclosures related to dividends and share buybacks are expected to be important points for investors to monitor.
Sources: 파이낸셜뉴스 증권
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