According to South Korean media reports, SK Hynix will make a significant investment this year, planning to invest over 20 trillion Korean won (approximately 13.7 billion US dollars) to expand factories focused on high bandwidth memory (HBM) production. This marks a historic milestone for the company, whose investment has never exceeded 20 trillion Korean won before. SK Hynix emphasized its commitment to increasing investment scale this year compared to the previous year, especially in the HBM field, during the 2024 performance report conference call.
The semiconductor industry is cyclical, influenced by technological advancements and global economic conditions, and the market has gone through periods of high and low demand. SK Hynix's strategic initiatives come at a time when large technology companies are investing in artificial intelligence (AI) and data center technology, leading to a surge in demand for advanced storage solutions such as HBM. As the main supplier of 8-layer and 12 layer HBM3E products to NVIDIA, SK Hynix is fully prepared to profit from this growing market.
This proactive investment strategy aims to consolidate SK Hynix's newly acquired leading position in the DRAM market. According to market research firm Counterpoint Research, SK Hynix's DRAM sales market share in the first quarter of this year was 36%, surpassing Samsung Electronics' 34%. The high-value HBM played an important role in SK Hynix's ascent to the top of the charts.
SK Hynix stated, "The investment scale will increase compared to last year, with a focus on the HBM field." This emphasis aligns with the company's overall strategy of expanding production capacity and maintaining competitive advantage in the context of the growing demand for fast data processing solutions in AI and big data technologies.
SK Hynix's historical investment model helps to understand the importance of this year's planned expenditures. In 2017, the company made its first investment exceeding 10 trillion Korean won. Subsequently, during the semiconductor super cycle of 2018 and the prosperous period driven by the pandemic in 2022, the company made large-scale investments. Due to the surge in investment demand for AI data centers, SK Hynix's investment in 2024 will reach nearly 18 trillion Korean won.
