The New York Stock Exchange debut of SK Hynix was supposed to be a crowning moment—a $26.51 billion American Depositary Receipt offering that marked the largest US listing ever by a foreign company. Instead, the listing has unleashed chaos in Seoul, where a 50% premium between the ADR and the domestic stock price triggered a cascade of forced selling and wiped out billions in leveraged bets. By Monday, shares in the South Korean memory-chip giant had slumped 4.23% to 1,764,000 won, leaving them 40.94% below the 52-week high set on June 25. A snap rebound of 4.08% on Tuesday pushed the stock back to 1,836,000 won, narrowing the deficit to roughly 39%, but the damage to investor confidence is already done.
The ADR offering priced at $149 per share and was more than seven times oversubscribed, drawing enormous demand from US investors eager for direct exposure to the High-Bandwidth Memory market. After opening with a 12% gain, the ADR surged to a high of $194.80 on July 14 before collapsing back to $154.03 by Monday. The gulf between the US-listed paper and the underlying Seoul shares at one point reached 50%, a dislocation that market participants say set the stage for the 15% single-day crash in Seoul on July 13—the biggest intraday slide in roughly two decades. The Korea Exchange was forced to temporarily halt trading. Chairman Chey Tae-won added fuel to the fire with a since-deleted Instagram post that promoted the Nasdaq ticker, further inflating the premium.
Behind the trading frenzy lies a business that has rarely been stronger. SK Hynix controls between 58% and 61% of the HBM market, the specialized memory that powers Nvidia’s AI accelerators. In the 2025 fiscal year, the company posted an operating profit of 47.2 trillion won, outstripping Samsung Electronics’ 43.6 trillion won for the first time. Production of 12-layer HBM4 chips for Nvidia began in late June, and output is being ramped up. Barclays slapped an “Overweight” rating on the stock after the listing, and many analysts still call it a top sector pick.
Yet the buoyant fundamentals have been overshadowed by the wreckage in the derivatives market. Since May 27, South Korean retail investors had poured roughly $9.5 billion into leveraged exchange-traded funds tied to Samsung and SK Hynix. The KODEX SK Hynix 2x Leverage ETF has lost about 70% of its value from its June peak. Nationwide, more than one million margin accounts were hit with calls, and between 320,000 and 360,000 were fully liquidated. Regulators responded by tightening margin requirements for single-stock leveraged products; on the first day of the new rules, turnover in the 16 affected products reached $8.6 billion. The broader Kospi index has not escaped: on July 20 it fell 4.5% to 6,516.28 points, entering bear-market territory more than 25% below its June high.
Should investors sell immediately? Or is it worth buying SK Hynix?
Chairman Chey acknowledged the tension in unusually blunt terms last week, describing current memory prices as “abnormally high” and predicting normalization. He also warned against artificially constraining supply and announced capacity expansions in Yongin, Honam, and the US. CEO Kwak Noh-jung has gone further, flagging the tightest supply shortage the industry has ever seen for 2027, with bottlenecks potentially shifting from chips themselves to power cables, electrical gear, and raw materials. Demand for AI semiconductors, Chey added, could rise 60% to 100% between 2026 and 2027, while the broader memory market expands 50% to 60%.
The company is now set to report second-quarter earnings on July 29, though earlier reports had flagged July 22. The numbers will be scrutinized against the backdrop of big-tech capital expenditure plans—the four largest hyperscalers are expected to invest roughly $725 billion in 2026 and nearly $900 billion in 2027. Hana Securities estimates that if Alphabet beats expectations on July 22, SK Hynix shares could rally 17% in the following four weeks; a miss would knock off about 3%. Additional pressure comes from Chinese memory maker CXMT, which plans to list on Shanghai’s Star Market on July 24 and raise an estimated $8.6 billion—Asia’s largest new issue this year. CXMT has already boosted its DRAM market share from 3% to 8% in a single quarter.
For now, the stock remains 16% below its 50-day moving average of 2,196,213 won, and annualized volatility over the past 30 sessions has exceeded 117%. The equation for SK Hynix is painfully simple: operations are at a record, but the stock is stuck in a storm of its own making.
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