SK Hynix Stock: Why This Chipmaker Is Betting $13B on AI Memory

TLDR

• SK Hynix commits $12.9 billion to build advanced packaging facility in Cheongju with April construction start and late 2027 completion date
• New plant will produce high-bandwidth memory chips using advanced packaging that stacks chips vertically for AI applications
• Company controls 61% of global HBM market, ahead of Samsung at 19% and Micron at 20%
• DRAM prices projected to jump 50-55% this quarter as chipmakers shift production toward AI memory
• HBM market forecast to grow 33% annually through 2030 driven by AI processor demand

SK Hynix revealed plans Tuesday to invest $12.9 billion in a new memory chip manufacturing facility. The South Korean company will build the advanced packaging plant in Cheongju, expanding its existing operations in the city.

Construction begins in April with the facility expected to open by late 2027. The plant will focus on producing high-bandwidth memory chips used in AI processors.

The investment reflects surging demand for specialized memory as artificial intelligence applications proliferate. SK Hynix supplies HBM chips to Nvidia and other AI hardware manufacturers.

Advanced packaging stacks multiple memory chips vertically into compact, high-density units. This design improves processing speed and energy efficiency while reducing physical footprint.

Market Leadership and Growth Projections

SK Hynix dominates the HBM market with 61% share. Samsung Electronics holds 19% while Micron controls 20%, according to Macquarie Equity Research.

Industry analysts project the HBM market will grow at 33% annually from 2025 through 2030. This expansion rate reflects increasing computational requirements for AI training and inference.

The company’s shares have climbed 12% year-to-date. Stock price dropped 2.5% Tuesday following the investment announcement.

Supply Constraints Drive Price Increases

Manufacturing HBM requires more complex processes than standard memory chips. As producers prioritize AI-focused memory, supplies of conventional chips have tightened.

TrendForce forecasts DRAM prices will rise 50-55% this quarter versus Q4 2025. The price surge stems from supply shifts as manufacturers allocate resources to HBM production.

Electronics manufacturers face higher component costs while memory producers see revenue gains. Samsung reported expected December quarter operating profit nearly tripling year-over-year.

Samsung has also announced HBM production increases in recent months. Both Korean chipmakers are racing to capture growing AI hardware demand.

SK Hynix is exploring a potential U.S. stock listing following strong 2025 performance. The Cheongju expansion builds on the company’s manufacturing presence in the region.

HBM technology first entered production in 2013 as a DRAM standard. The vertical stacking design helps process large data volumes generated by complex AI workloads.

The new facility will begin construction in April. Completion is targeted for the end of 2027.

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