A month after its initial public offering (IPO) on Nasdaq, South Korean chipmaker SK Hynix decided to expand its production with a new investment cycle.
On Friday, August 7th, the company announced an investment of US$38 billion to build two factories, one in Yongin, which will absorb two-thirds of these resources, and another unit in Cheongju, both in South Korea.
The initiative, which encompasses both dynamic memory for lower latency and fast-access storage for larger amounts of data, is a response to the "growing demand for memory in the age of AI," according to a company statement.
According to market research firm Omdia, demand for Dynamic Random Access Memory ( DRAM ) and the NAND model is expected to reach a compound annual growth rate of 19% by 2030.
According to the company's assessment, this growth is not seen as a temporary supercycle, but as a structural transformation in which memory transcends its role as a component to become essential infrastructure that determines AI performance.
Considered fundamental to the boom in artificial intelligence infrastructure and a key partner of the American company Nvidia , SK Hynix helped boost South Korea's Kospi index, but recently it has also become a source of enormous volatility, as sentiment towards AI has oscillated between enthusiasm and skepticism.
Although the company's production capacity is exhausted by 2027 and it is increasingly closing long-term contracts with clients, doubts persist in the market about its ability to maintain current profit margins in the long term.
Together with Samsung , SK Hynix has made a public commitment to invest even more in developing production capacity and artificial intelligence in South Korea. The investment pledged by these two leading companies in the country exceeds US$880 billion.
The Asian country's plan is to double its memory production capacity within five years and secure global manufacturing capabilities to stand out from its main competitors.
"The company is actively exploring additional shareholder return initiatives as part of its ongoing commitment to increasing shareholder value," says the SK Hynix statement.
Construction in Yongin is scheduled to begin in July of next year, with the goal of opening its plant in June 2029 to produce high-bandwidth memory (HBM) and other next-generation DRAM products.
The Cheongju factory will be built on a total area of 680,000 square meters (m²), with construction scheduled to begin in February of next year and the first phase inaugurated in December 2028. The investment period extends until April 2031, according to the company's master plan.
In the largest foreign IPO in the United States since Alibaba in 2014, SK Hynix made history by raising US$26.5 billion on July 10 of this year, in a move driven precisely by the explosion of investments in AI.
The company's Nasdaq listing this year was second only to the IPO of rocket manufacturer SpaceX in June, which raised $85.7 billion.
In the second quarter of this year, SK Hynix reported net revenue of approximately US$54.8 billion, a 257% increase over the same period of the previous year, although still slightly below market expectations. Net income grew by 1,242%, driven by strong demand for high-performance computing components.
Originally listed on the Korean Stock Exchange, the semiconductor manufacturer's shares are projected to appreciate by 110% by 2026. Over the past 12 months, the increase is 454%. SK Hynix's market capitalization is US$737 billion.
