SK Hynix, South Korea’s second largest chipmaker behind Samsung, will invest $74.6 billion over the next three years to develop memory chip technologies focused on artificial intelligence (AI). Parent company SK Group will also seek to secure a further $57.8 billion to further fund its AI efforts by 2026.
AI, a strategic challenge for SK Hynix
SK Hynix sees these massive investments in AI as a way of regaining the heavy losses suffered recently by both Hynix and its vehicle battery subsidiary. The company hopes to generate profits of $16 billion in 2024, rising to nearly $30 billion by the end of 2025. These investments are also aimed at strengthening Hynix’s position in the global technology sector.
The AI race in the semiconductor industry
The AI world is highly competitive at the enterprise level, with tech giants like Google, Microsoft and Nvidia taking the lion’s share. But the semiconductor market is a little more competitive. At a time when demand for chips capable of forming AI systems has exploded, SK Hynix sees AI as a way of standing out from the crowd.
The strategic importance of memory chips for AI
SK Hynix is the world leader in HBM (High Bandwidth Memory) chips, which are essential for the development of AI because they offer much higher processing speeds than traditional memory chips. The company is the main supplier of HBM chips to Nvidia, the world leader in AI chips. SK Hynix is betting heavily on this promising niche.
