SK Hynix invests $74.6 billion in AI chips
On June 30, SK Group, the parent company of SK Hynix in South Korea, said that by 2028, SK Hynix will invest 103 trillion won (74.6 billion U.S. dollars) to strengthen its chip business and focus on artificial intelligence. About 80%, or 82 trillion won, will be used to invest in high-bandwidth memory chips (HBM).
SK Hynix is a leader in the high-bandwidth memory (HBM) chip market, and its HBM chips are optimized for use with Nvidia's artificial intelligence accelerators. As part of its bet on artificial intelligence, SK Telecom and SK Broadband will invest 3.4 trillion won in data center business.
SK Group hopes to enhance its competitiveness by focusing on the AI value chain, including high-bandwidth memory, AI data centers, and AI services such as personalized AI assistants. SK Group Chairman Choi Tae-won said in a video conference that in the face of a new era of transformation, SK Group must take the initiative to make major changes.
In the AGI era, storage will play a key role in processing data, and AI systems are connecting a large number of AI chips and storage in parallel to accelerate large-scale data processing. This means that the performance of AI systems depends on stronger and faster memory. SK Hynix is also working to lead "Memory-Centric AI Everywhere" in various industries such as AGI, data centers, mobile and PC systems.
SK Group estimates that pre-tax profit will reach 22 trillion won this year, reversing last year's losses, and aims to increase annual pre-tax profit to 40 trillion won in 2026. The goal also includes ensuring 30 trillion won of free cash flow within three years and keeping the debt-to-asset ratio below 100%.
The plan was proposed after SK Group Chairman Chey Tae-won and about 20 senior executives held an annual strategic meeting to discuss the development direction of the second-largest conglomerate in South Korea after Samsung.
The stakes are particularly high this year because Chey Tae-won needs to find $1 billion for a divorce settlement.
On May 30 this year, the Seoul High Court ruled that SK Group Chairman Choi Tae-won divided 1.38 trillion won (about 1 billion US dollars) of property and paid 2 billion won in alimony to Roh Su-young, the daughter of former South Korean President Roh Tae-woo, making this the most expensive divorce case in South Korea to date.
Although this is the first time SK has disclosed its investment plan until 2028, SK Hynix has announced a series of investment plans this year, including spending $3.87 billion to build an advanced packaging plant and artificial intelligence product research center in Indiana. In China, SK Hynix will spend $14.6 billion to build a new memory chip complex and continue other domestic investments, including investments in the Yongin semiconductor cluster.
In addition to SK Hynix, Micron is also preparing to increase its investment in the AI track.
Micron CEO Sanjay Mehrotra said on June 26 that Micron expects to significantly increase capital expenditures next year, and 34-36% of revenue in fiscal year 2025 will be invested in capital expenditures to support HBM packaging and testing equipment, wafer fabs and back-end facilities construction, and technology upgrade investments to support demand growth.
According to people familiar with the matter, Micron is expanding HBM-related R&D facilities, including production lines and verification lines, at its headquarters in Boise, Idaho, USA. Micron has said that it hopes to increase its HBM market share to 24-26% by the end of 2025. Micron's largest HBM production base is located in Taichung, Taiwan, China, and local production capacity is currently being expanded.
