Samsung Electronics and SK Hynix each conducted large‑scale share buybacks from August to October last year. The combined repurchase amount was about 4.65 trillion won, roughly 1.7 times the net sale proceeds of foreign investors (2.66 trillion won). As a result, KOSPI rose only 0.4 % in the short term. However, after the buybacks were completed, the following ten trading days saw the repurchase amount fall to about 60 % of the net foreign sales, and KOSPI fell 17.4 %.
The core reason for the modest price effect is uncertainty over whether AI firms will remain profitable. The research analyst argued that U.S. interest‑rate hikes and rising energy costs, together with the September CPI release, would weigh on the AI industry. Consequently KOSPI plunged 7.6 % in a single day, and concerns grew that semiconductor companies’ strong profit prospects might not continue next year, prompting an increase in foreign selling pressure.
Share repurchases could absorb some of the foreign selling pressure, but they did not fully eliminate the downward pressure on price. In particular, SK Hynix’s new buyback was underway when liquidity conditions tightened; concerns over AI investment profitability again surged and a sharp fall in price followed, revealing that relying solely on share repurchase cannot prevent a price decline. Accordingly, how much of the foreign selling pressure can be absorbed by the new repurchase at SK Hynix is crucial, and Samsung Electronics’ timing for next‑year January buyback will be evaluated carefully.
Finally, the analyst noted that a share repurchase announcement may have a short‑term effect on price, but whether AI profitability concerns ease and confidence in memory profit outlook returns remains uncertain. This sends a cautionary message to investors who expect continuous growth in the semiconductor industry.