Report

Seoul-based SK Hynix anticipates the potential for a twofold increase in its market value over the next three years, reaching 200 trillion won ($152 billion), primarily driven by the demand for its memory chips tailored for artificial intelligence applications, according to CEO Kwak Noh-Jung. Speaking at the CES 2024 tech conference in Las Vegas, Kwak emphasized the growing significance of memory in the era of generative AI and highlighted the evolving demands of customers as AI systems advance.

Emphasizing the importance of strategic product preparation, efficient investment maximization, and financial stability, Kwak expressed confidence in doubling the current market capitalization from 100 trillion won to 200 trillion won within the specified timeframe. 

SK Hynix Forecasts Market Value Surge

SK Hynix has maintained a leading position in the development of high bandwidth memory (HBM) chips, specifically HBM3, designed for the rapidly expanding field of generative AI. Notably, the company has secured Nvidia, a prominent AI-chip leader, as a key client.

While competitors like Samsung Electronics and Micron have introduced their versions of the next-generation HBM3E, SK Hynix has consolidated its internal HBM capabilities to stay at the forefront of the market, as affirmed by Kwak. 

Regarding potential production adjustments, he indicated changes in the first quarter for DRAM chips used in tech devices, signaling a possible increase in production. For NAND flash chips used in data storage, the chipmaker plans to respond to market conditions after mid-year.

Memory chip manufacturers, including SK Hynix and Samsung, had implemented significant production cuts since the previous year to navigate the industry’s severe downturn caused by high inflation impacting the demand for chip-containing devices. 

However, with memory chip prices rebounding, industry leader Samsung has signaled an intention to boost production by taking in more supply of silicon wafers during the fourth quarter. In afternoon trade, SK Hynix saw a 1.2 percent increase, resulting in a market capitalization of 100.1 trillion won, while the broader market showed a 0.1 percent decrease.

(Note: Exchange rate – $1 = 1,312.3400 won)

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