On January 26, 2024, the SK Hynix flag (R) and the Korean national flag (L) fly outside the Bundang office in Seongnam City.
Jung Young Jae | AFP | Getty Images
US investors have a new way to capitalize on the memory boom.
SK HynixSouth Korea’s second most valuable company after Samsung, is scheduled to begin trading on the Nasdaq on Friday. The market debut, which coincides with the company’s major expansion plans in the U.S., comes after the stock price has increased more than sevenfold over the past year, pushing SK Hynix’s market capitalization to around $1 trillion.
Many Americans don’t know the name SK Hynix, but they’ve probably been familiar with the company’s products. with micron Samsung and SK Hynix are one of the three major manufacturers of computer memory used in laptops and mobile phones. apple and Dell.
Memory has long occupied a sleepy corner of the semiconductor market. This situation has changed dramatically in recent years, as a surge in demand for artificial intelligence has disrupted the industry, created severe chip shortages, and driven prices to all-time highs.
SK Hynix is a leader in high-performance memory used in AI chips. Nvidiathe world’s most valuable company. Memory components are typically relatively simple chips called RAM that all computers need to store data, but high-bandwidth memory (HBM) is more complex because it stacks traditional memory in layers. SK Hynix was the first to do so, and analysts predict it will capture more than half of the market this year.
In June, NVIDIA CEO Jensen Huang visited SK Hynix on a trip to Seoul, where the two companies announced a multi-year partnership. Nvidia is HBM’s largest buyer.
“This advantage has made SK Hynix one of the biggest beneficiaries of the rapid growth of AI infrastructure,” TrendForce analyst Ellie Wang said.
SK Hynix will trade on the Nasdaq market under the ticker symbol SKHY (originally SKHYV), according to a regulatory filing. The company plans to raise about $29 billion by issuing American Depositary Receipts (ADRs) to fund new plants and equipment.
Part of that expansion is taking place in the United States, where SK Hynix is building its first production facility in the country, scheduled for completion in 2028. The $4 billion factory in West Lafayette, Indiana, will be used for so-called advanced packaging, a key part of the HBM manufacturing process that connects and stacks individual chips into larger systems that can be used in computers.
SK Hynix will receive up to $458 million in funding from the U.S. Chip and Science Act, passed in 2022 as the centerpiece of the country’s chip industry development plan. The company may also receive a loan of up to $570 million from the U.S. Department of Commerce.
HBM is not the only company supporting SK Hynix. The entire memory industry is experiencing price hikes due to AI demand, which means traditional memory needed for phones, tablets, PCs, cars, medical devices and other products is also in short supply. Profit margins are at record levels.
More than three-quarters of SK Hynix’s revenue comes from RAM, including HBM. The company also makes NAND flash (hard drives) and is the market leader with a 19% share in the first quarter, according to IDC.
SK Hynix’s financial situation is as impressive as its stock price. From 2023 to 2025, annual revenue nearly tripled, reaching approximately $65 billion in sales. Analysts compiled by LSEG expect that number to more than triple to about $235 billion by 2026.
History of booms and busts
The company’s path to the Nasdaq has not been a consistent upward trajectory.
SK Hynix was founded in 1983 as Hyundai Electronics, a subsidiary of South Korean conglomerate Hyundai. In 1997, during the financial crisis, memory prices were low due to oversupply, so the company merged with LG Semicon. Four years later, the company was rebranded as Hynix Semiconductor, and in 2012, SK Telecom purchased a controlling stake and became SK Hynix.
According to the SEC filing, as of March 31, “SK Square, which was separated from SK Telecom in 2021, held a 20.5% interest in the company.”
The cyclical nature of business means betting on memory booms has proven risky. Big technology changes like the dot-com craze, the growth of smartphones, and the move from packaged software to the cloud have created a huge demand for memory to power new devices. That often leads to oversupply, followed by a collapse in prices.
This concern is widespread today given the rapid growth of AI. But the industry is preparing for any changes that may come.
SK Hynix, along with Micron and Samsung, uses its market power to execute long-term memory contracts that lock in prices and orders for years into the future. In the past, memory companies often sold their supplies on a quarterly or annual basis.
Companies of all sizes, including giants like Apple, are scrambling to secure memory.
“These contracts typically require the customer to provide long-term demand visibility,” TrendForce’s Wang said, which allows SK Hynix to plan spending with more confidence.
Investors need to weigh the risks of buying at these levels based on historical knowledge, said Futurum Group analyst Daniel Newman.
“Memory always behaves like this in megacycles and supercycles,” Newman said. “The problem is, it crashes hard all the time.”
But Newman added that memory companies like SK Hynix are a bargain if demand for AI remains high. Industry experts say AI will need more memory to operate without hitting a “memory wall,” and memory vendors say the shortage won’t end until at least 2027.
SK Hynix is hoping for that.
In South Korea, SK Hynix plans to spend up to $720 billion to expand its facilities to meet memory demand for AI, the company said.
One cluster of chip manufacturing factories in Yongin, just south of Seoul, will cost $390 billion to build. The company has accelerated its project schedule by more than a decade, with four factories now scheduled to be completed by 2033. Elsewhere in South Korea, SK Hynix is expanding its production facility in Cheongju and developing a new factory complex in the southwestern part of the country.
These factories require SK Hynix to invest significant capital in critical chip manufacturing equipment known as extreme ultraviolet lithography (EUV) machines. EUV equipment is needed to etch advanced circuits required for manufacturing and stacking advanced chips such as HBM. These are hard to come by, cost up to $400 million, and are manufactured by: ASML In the Netherlands. SK Hynix plans to spend about $7.8 billion on new EUV equipment by the end of 2027, according to an SEC filing.
“If you go to South Korea, there are a lot of factories being built,” said MS Hwang, research director at Counterpoint. “But that will take time. The earliest we can ship manufactured wafers is the end of 2027.”
In the US, SK Hynix has major expansion plans in addition to its Indiana project.
In January, the company announced it had set aside $10 billion to invest in its so-called AI Company, an effort to find new product lines and support its U.S. operations.
The largest component of AI Company is Solidigm. The company manufactures NAND flash memory and was acquired from intel 9 billion in 2021. Currently headquartered in Rancho Cordova, Calif., near Sacramento, the company is developing new products such as solid-state drives that can store more data.
Most of the activities are still in progress back home.
“Everyone is coming,” Hwang said, referring to companies flocking to South Korea to secure big contracts.
Fan said word on the street is that nearby hotels are “full” as cloud companies and semiconductor manufacturers “are lining up to sign long-term contracts.”
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