SK Hynix invests $13 billion in advanced packaging plant to address AI memory bottleneck

SK Hynix plans to open $13B HBM packaging plant in 2027

Great news for AMD and Nvidia, less so for cash-strapped consumers Memory makers just can't churn out their DRAM fast enough. On the heels of an AI-driven shortage, SK Hynix on Tuesday announced a new 19 trillion Korean won (about $13 billion) advanced packaging and test facility in South Korea that could offer some relief - just not for consumer products like laptops and phones. The South Korean memory giant unveiled the new site, dubbed P&T7, which will be located at the Cheongju Technopolis Industrial Park in Chungbuk, South Korea. Work on the plant is expected to begin in April with completion targeted for the end of 2027. The site aims to address surging demand for high-bandwidth memory (HBM) modules used extensively in datacenter GPUs and AI accelerators. Between 2025 and 2030, SK expects HBM demand to grow by an average of 33 percent a year, fueled in no small part by extreme demand for AI infrastructure. HBM is manufactured by stacking multiple layers of DRAM - eight and 12 layers are most common - to achieve higher capacity and bandwidth while reducing energy consumption in the process. The process is incredibly expensive, as a single defect in any of the layers could render the final module worthless. Worse, because of HBM's prodigious data rates - as high as 2.75 TB/s per module in the latest generations - the chips usually need to be permanently co-packaged alongside the compute logic. This makes the margin incredibly tight. Defective modules could scrap a $50,000 GPU. Because of this, specialized packaging and test facilities, like SK's newly announced P&T7 site, are essential to producing HBM in volume. Development of the P&T7 facility comes as SK Hynix prepares to bring its M15X DRAM plant online. Announced in 2024, the 20 trillion won (about $13.5 billion) DRAM plant was built to address growing HBM demand. It opened its clean room in October and, according to SK, work to deploy fab equipment is progressing smoothly. While the new packaging site may be welcome news for the likes of AMD or Nvidia - two of the largest consumers of HBM memory - the packaging site will likely do little to address skyrocketing memory prices seen by consumers and businesses over the past few months. While HBM has appeared in consumer products in the past, its extreme cost and complexity usually preclude its use in modern client devices. DDR5 memory kits that, a year ago, sold for less than $100 are now going for well in excess of $300 as vendors grapple with the ongoing DRAM and NAND crunch. As we previously reported, DRAM prices are expected to remain high for the next several years, driven in part by strong demand for AI infrastructure. Analysts predict DRAM prices to peak later this year before plateauing in 2027, and rising again in 2028. While customers pay through the nose, memory vendors are raking in billions of dollars of revenue. Last week, Samsung issued a revised Q4 forecast in which it predicted its operating profits would more than triple, while Micron and SK Hynix's profits are expected to more than double. ®

SK Hynix to invest $13 billion in new plant amid memory chip shortage

A visitor takes a picture of a model of SK hynix's high-bandwidth memory (HBM) technology during the 2025 World IT Show in Seoul on April 24, 2025. South Korea-based memory maker SK Hynix announced Tuesday it will invest 19 trillion Korean won ($12.9 billion) to build a new advanced packaging plant, as it expands production to meet rising demands driven by the artificial intelligence boom. The new fabrication facility will be located in the Korean city of Cheongju, building on the company's existing footprint there. Construction set to begin in April, with completion targeted for the end of 2027, the firm said in a statement. SK Hynix is among the world's largest producers of memory chips and leads the world in so-called high-bandwidth memory (HBM), which is used in artificial intelligence processors, including those designed by U.S. chipmaker Nvidia. The new fab will help SK Hynix meet growing demand for HBM as global AI competition intensifies, pushing up prices and making it very lucrative for memory giants. According to industry projections cited by SK Hynix, the HBM market is expected to expand at a compound annual growth rate of 33% between 2025 and 2030. However, the shift by producers to meet AI demand has strained supplies of conventional memory chips, raising concerns that shortages could impact the broader electronics industry. In response, memory chip makers have been expanding production capacity, as with SK Hynix's new advanced packaging and testing facility. Advanced packaging in memory is the process of combining multiple memory chips into a single, high-density unit to improve performance and energy efficiency while reducing overall size. SK Hynix rival Samsung Electronics has also announced plans to ramp up HBM production in recent months.

In a bid to meet the memory supply crisis head on, SK Hynix announces it will invest nearly $13 billion into fresh AI packaging facility

SK Hynix has announced this week it will invest 19 trillion won (or $12.90 billion) into a new advanced chip packaging facility in Cheongju, South Korea -- and it isn't the only company making multi-billion dollar moves to meet the demands of the raging memory supply crisis. SK Hynix is one of Nvidia's leading suppliers of high-bandwidth memory (HBM) for its AI accelerators. The planned chip packaging facility is set to begin construction this April, but won't be able to address demand until after work is complete in late 2027 (via Bloomberg). This follows news last year of the company committing an additional $500 billion to building four new memory fabs, with the first of these aiming for a similar 2027 completion window. Chey Tae-won, the chairman of SK Hynix's parent group, SK Group, recently spoke during a keynote speech at the SK AI Summit in Seoul, saying, "We have entered an era in which supply is facing a bottleneck. We are receiving memory chip supply requests from many companies, and we are thinking hard about how to address all demands." With the limited flow of memory now actively restricting how many data centres can be built, it's not the only company announcing plans to address the situation. Memory maker Micron, too, has just announced plans for a massive megafab, this time in New York. Apparently not wanting to be outdone on AI's world stage, the planned semiconductor manufacturing facility will be the largest in the US, with Micron investing $100 billion into the project set to break ground in Onondaga County "following rigorous environmental review and necessary permit approvals." Micron shut down their consumer sub-brand Crucial in favour of focussing on supplying AI data centres, though the release of the Micron 3610 NVMe SSD has since suggested the company still wants to keep a toe in the consumer space moving forward. Still, like many memory manufacturers, it sees that economic winds remain favourable for AI acceleration (SK Hynix predicts the HBM market will, on average, grow about 30% every year between 2025 and 2030, according to Reuters). "Breaking ground at Micron's New York megafab is a pivotal moment for Micron and the United States," Micron CEO Sanjay Mehrotra said, "I want to thank President Trump, Secretary Lutnick, Administrator Zeldin, Governor Hochul, Senator Schumer, Congressman Mannion, Congresswoman Tenney, County Executive McMahon and all of our partners in the Administration and Congress for their leadership and partnership in getting to this milestone." He adds, "As the global economy enters the AI era, leadership in advanced semiconductors will be the cornerstone in innovation and economic prosperity. Our investments and progress solidify our position as the only United States manufacturer of memory." But even with all of these billions from two major memory makers, there's little use hoping the memory crisis will be alleviated before the end of this year. For one thing, all of these builds will take more than the year to complete and are not really geared towards meeting consumer demand. But for another, even with memory production scaling up, the demand coming from AI data centres is growing even faster, with some industry observers predicting the memory supply crisis could run into 2028 and beyond.

SK Hynix to invest nearly $13 billion in chip packaging plant in South Korea

SK Hynix said accelerating global competition in AI is driving a sharp rise in demand for AI-focused memory, underscoring the need to respond proactively to growing demand for high-bandwidth memory (HBM) chips. South Korea's SK Hynix said on Tuesday it has decided to ⁠invest 19 trillion won ($12.90 billion) to build an advanced chip packaging plant in South Korea to meet rising memory chip demand related to artificial intelligence. The chipmaker said in a statement that the construction of the new factory will begin in April, with completion targeted by the end of next year. SK Hynix said accelerating global competition in AI is driving a sharp rise in demand for AI-focused memory, underscoring the need to respond proactively to growing demand for high-bandwidth memory (HBM) chips. HBM - a type of dynamic random access memory or DRAM standard first produced in 2013 - involves stacking chips vertically to save space and reduce power consumption, helping to process the large volumes of data generated by ⁠complex ⁠AI applications. SK Hynix, the main HBM supplier to Nvidia, was the leading player in the HBM market last year, with a 61% share, followed by Samsung Electronics at 19% and Micron at 20%, data from Macquarie Equity Research showed.

SK Hynix Announces Mega Investments to Enter Advanced Packaging Business as AI Demand Forces It to Take Production Into Its Own Hands

SK hynix, a prominent memory manufacturer, has unveiled plans to build advanced packaging production lines in South Korea to meet the growing demand. Advanced packaging is emerging as one of the significant bottlenecks in the AI supply chain, as companies have based their chip portfolios on this technology, and current production lines are insufficient to meet demand. Technologies like CoWoS enable firms like NVIDIA/AMD to integrate HBM modules directly onto the main compute die. This is why, for memory manufacturers like SK hynix, having sufficient advanced packaging capacity is a necessity. In their latest announcement, SK hynix is now investing heavily in Cheongju, South Korea, for advanced packaging. Amidst this changing environment, SK Hynix has decided to invest in a new advanced packaging fab, P&T7 , to ensure a stable response to global AI memory demand and optimize production at its Cheongju fab. This investment is a strategic decision that resonates with the government's policy of balanced regional growth while comprehensively considering supply chain efficiency and future competitiveness. - SK hynix The advanced packaging fab, called the P&T7, will be built with a total investment of approximately $13 billion, serving as an "organic linkage" between the company's upcoming M15X DRAM facility. This means that SK hynix now plans to offer a one-stop solution for HBM customers within the Cheongju Techno Valley Industrial Complex. After DRAM modules are manufactured, they will be transferred to advanced packaging lines, where the remaining manufacturing and stacking processes will be carried out. SK hynix has previously been reported to be building a 2.5D packaging plant in the US, with an investment of almost $4 billion. However, the bigger question here is whether the Korean giant itself has an alternative similar to TSMC's CoWoS. We do know that SK hynix does utilize MR-MUF vertical stacking for its HBM solutions, but when it comes to packaging the entire chip, the company has been reliant on TSMC. The recent investments do indicate that SK hynix looks to increase its competitiveness in the HBM segment by offering its clients a turnkey solution. The company hasn't disclosed the type of technology these advanced packaging lines would focus on. Still, our best estimate is that SK hynix would likely form a partnership with companies like Amkor or possibly even TSMC by investing the necessary funds to produce advanced packaging products in its facilities. Alternatively, SK hynix could develop a proprietary technology, reducing its reliance on foundry partners.

SK Hynix Bets $13 Billion To Lock In AI Memory Dominance - Advanced Micro Devices (NASDAQ:AMD), Alphabet (NASDAQ:GOOGL)

SK Hynix, Samsung Electronics Co. Ltd. (OTC:SSNLF), and global rivals, including Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM) and Micron Technology Inc. (NASDAQ:MU), are accelerating investments as competition intensifies to supply high-bandwidth memory and advanced chips for the artificial intelligence boom. SK Hynix Commits $13 Billion To Expand AI Memory Capacity SK Hynix is ramping up investment to strengthen its position in the global AI chip supply chain as demand for high-bandwidth memory (HBM) continues to surge. The South Korean memory giant, the world's top supplier of HBM to Nvidia Corp. (NASDAQ:NVDA), said it will invest 19 trillion won (about $13 billion) to build a new advanced semiconductor packaging and testing facility, known as P&T7, in the Cheongju Techno Polis industrial complex. Construction will begin in April, with completion likely by 2027 and full operations expected in 2028, the Korea Economic Daily reported on Tuesday. The plant will focus on advanced packaging, the back-end process that combines multiple memory chips into high-density units that improve performance and energy efficiency for AI workloads. Rising Competition in the High-Bandwidth Memory Market The investment comes as competition heats up across the AI memory market. Samsung has also announced plans to ramp up HBM output. It has hiked prices on key memory chips by up to 60% since September. Taiwan-based rivals, including Taiwan Semiconductor and U.S. firms such as Micron, are racing to secure capacity. HBM demand is accelerating as AI and generative AI workloads require faster and more power-efficient memory to handle massive data volumes. HBM plays a critical role in training large language models and powering AI accelerators used by Nvidia, Alphabet Inc.'s (NASDAQ:GOOGL) Google and Advanced Micro Devices, Inc. (NASDAQ:AMD). SK Hynix leads the global HBM market with a 53% share in the third quarter of 2025, while Samsung followed with 35% and Micron held 11%, according to Counterpoint Research. Industry projections cited by SK Hynix forecast the global HBM market will grow at a 33% compound annual rate from 2025 to 2030. Memory Pricing Tightens Amid Supply Constraints Pricing has also tightened. TrendForce said it expects average DRAM prices, including HBM, to rise 50% to 55% this quarter compared with the fourth quarter of 2025, as AI-driven demand increases and conventional memory supply tightens, CNBC reported on Tuesday. SK Hynix said the P&T7 plant will be responsible for the final assembly and quality inspection of chips manufactured at its front-end fabrication facilities, transforming silicon dies into finished products through advanced packaging processes. The site will be located next to M15X, the company's next-generation DRAM manufacturing facility in Cheongju, which is currently being built under a separate investment of 20 trillion won. Once both facilities are operational, DRAM wafers produced at M15X will be packaged into high-bandwidth memory products on-site, enabling a more vertically integrated manufacturing workflow. Following the launch of P&T7, SK Hynix will run three major advanced packaging centers worldwide, located in Icheon near Seoul, Cheongju, and West Lafayette, Indiana. Image via Shutterstock AMDAdvanced Micro Devices Inc$210.971.58%OverviewGOOGLAlphabet Inc$334.350.75%MUMicron Technology Inc$345.01-0.25%NVDANVIDIA Corp$185.670.39%SSNLFSamsung Electronics Co Ltd$65.2154.0%TSMTaiwan Semiconductor Manufacturing Co Ltd$332.460.21%Market News and Data brought to you by Benzinga APIs

SK hynix confirms new packaging fab construction in Cheongju - The Korea Times

An artist's rendering of SK hynix's P&T7 packaging fab in Cheongju, North Chungcheong Province / Courtesy of SK hynix SK hynix on Tuesday confirmed the construction of its new semiconductor packaging fab, dubbed P&T7, in Cheongju, North Chungcheong Province, as the memory giant accelerates expansion of its production capacity for high-bandwidth memory (HBM) for artificial intelligence (AI) accelerators. On its website, SK hynix said it will invest 19 trillion won ($12.92 billion) to build the P&T7 fab on a 230,000-square-meter site in the city's industrial complex. Construction is set to begin in April with completion targeted for the end of 2027. The company said it is "a strategic decision that reflected the government's policy goal of balanced national growth while also taking into account supply chain efficiency and future competitiveness." According to the company, P&T stands for packaging and testing, and P&T7 will be an advanced packaging facility that turns chips produced at front-end fabs into finished products and conducts final quality inspections. The P&T7 plan has been rumored since June 2025, as the company demolished buildings on the site of LG's former Cheongju Plant 2 that SK hynix had previously acquired to make way for a new packaging facility. P&T7 is designed to work in tandem with the existing M15 fab and the M15X facility now being built for HBM production in Cheongju. Of the two, SK hynix invested 20 trillion won in M15X, which opened its cleanroom in October 2025 ahead of schedule and is now in the final stages of equipment installation. Along with M15 and M15X, SK hynix has M11, M12 and P&T3 fabs in Cheongju, which is about 130 kilometers south of Seoul. "The organic link between the M15X and P&T7 is expected to position the city as SK hynix's new core hub for AI memory, as well as strengthening its ability to meet rising demand for advanced memories," SK hynix said. While announcing the new investment, SK hynix stressed the decision aligns with the government's policy goal of balanced national growth. "Amid the rapid shifts in the investment environment surrounding the semiconductor industry, there are debates over the meaning and role of investments in the noncapital area," the company said. "SK hynix sees beyond short-term efficiency or immediate gains, and seeks to make contribution in strengthening the country's industrial foundation over the long term and building a structure in which the capital and noncapital regions grow together." The company referred to debates among political voices that semiconductor fabs should be located across the country for balanced growth alongside the semiconductor industry's hesitation, citing infrastructure and workforce issues. President Lee Jae Myung on Dec. 10, 2025, told Samsung Electronics' chip division head Vice Chairman Jun Young-hyun and SK hynix CEO Kwak Noh-jung that he hopes for "semiconductor companies to turn their eyes to the southern region and make contributions to the country's balanced development." Minister of Climate, Energy and Environment Kim Sung-hwan also floated the necessity of dispersing the chip cluster during a radio interview. The comments were interpreted to be targeting that semiconductor complex that the two companies are building or set to build in Yongin, Gyeonggi Province, about 50 kilometers south of Seoul. SK hynix had already begun construction, while Samsung Electronics has recently signed deals to purchase land in Yongin. Lawmakers from the southern part of the country have also raised their voices, with those from North Jeolla Province urging the industrial complex to be relocated to the province's Saemangeum area, about 250 kilometers southwest of Seoul. Though presidential spokesperson Kim Nam-joon said Thursday that any relocation decision would be up to the company, lawmakers' calls are growing. Semiconductor industry officials expressed concern that political considerations could end up dictating corporate decisions based on feasibility, because both Samsung and SK hynix considered Yongin's grid infrastructure, water resources and the advantage of the capital area in attracting workers. Samsung Electronics operates its main semiconductor complexes in Yongin, Hwaseong and Pyeongtaek, all in Gyeonggi Province, which surrounds Seoul. It also has a packaging facility in Asan, South Chungcheong Province, located about 100 kilometers south of Seoul.

SK Hynix to spend $13 billion on South Korea chip packaging plant By Investing.com

Investing.com-- Nvidia (NASDAQ:NVDA) supplier SK Hynix Inc (KS:000660) said on Tuesday it will spend 19 trillion won ($13 billion) to build an advanced chip packaging plant in South Korea, as the memory chips supplier benefits from outsized artificial intelligence demand. SK Hynix said the project will be built in the city of Cheongju, with construction set to begin in April. The company already has several production facilities in the city. Get more breaking news and top AI stock picks with InvestingPro The chipmaker said the new plant was largely aimed at bolstering its production capacity in response to rising AI-fueled demand for memory. Memory chips are a key component of AI processors, especially the advanced high-bandwidth memory chips made by SK Hynix. The company, along with rival Samsung Electronics Co Ltd (KS:005930), is among the world's largest memory chips maker, and also makes the most advanced HBM chips available in the market. This makes it a key component of the AI supply chain, with SK Hynix also acting as a major supplier for Nvidia. The company is set to report its December quarter earnings next week, and is widely expected to have logged a bumper print on outsized AI demand. Rival Samsung had last week flagged an over 200% surge in its profit for the same period. SK Hynix and Samsung are also set to benefit greatly from a sharp increase in memory chip prices, as AI demand largely outpaced supply. SK Hynix shares fell 0.5% in morning trade, but remained close to record highs.

SK Hynix to Build $13 Billion Chip Packaging Plant in South Korea

SK Hynix, a major supplier of high-bandwidth-memory products to Nvidia, plans to build a $13 billion chip packaging plant in South Korea amid surging demand for artificial-intelligence chips. The South Korean memory-chip maker said Tuesday it will spend 19 trillion won to build an advanced facility for packaging and testing AI chips in Cheongju, south of Seoul. The new plant, due to be completed by the end of 2027 with construction set to start in April, will add to SK Hynix's chip-packaging capacity in South Korea. The company is also building facilities in the U.S. SK Hynix "is proactively responding to rising HBM demand" amid surging AI memory demand, according to a statement released by the company. The HBM market is expected to grow 33% annually on average from 2025 to 2030, it said. HSBC analyst Ricky Seo said in a research note on Tuesday that SK Hynix would continue to benefit from what he calls "a memory supercycle" that could last for four to five years. The upbeat outlook is underpinned by solid HBM shipments supported by robust AI investments, as well as strong demand for conventional commodity dynamic random-access memory chips, he said. The chip maker is set to post record fourth-quarter earnings, Seo said. Its operating profit in the October-December period is expected to have surged 57% from the previous quarter to a record 18 trillion won, with its DRAM and NAND chip prices likely having risen 25% and 20%, respectively, he said. The South Korean won's weakness against the U.S. dollar also likely helped boost SK Hynix's quarterly earnings, Seo added. The company is expected to disclose its results later this month. Shares in SK Hynix were down 1.6% in Tuesday afternoon trading on profit taking following recent gains. Nonetheless, the stock is up around 13% so far this year.

SK Hynix to invest nearly $13 billion in chip packaging plant in South Korea

SEOUL, Jan 13 (Reuters) - South Korea's SK Hynix said on Tuesday it has decided to invest 19 trillion won ($12.90 billion) to build an advanced chip packaging plant in South Korea to meet rising memory chip demand related to artificial intelligence. The chipmaker said in a statement that the construction of the new factory will begin in April, with completion targeted by the end of next year. SK Hynix said accelerating global competition in AI is driving a sharp rise in demand for AI-focused memory, underscoring the need to respond proactively to growing demand for high-bandwidth memory (HBM) chips. HBM - a type of dynamic random access memory or DRAM standard first produced in 2013 - involves stacking chips vertically to save space and reduce power consumption, helping to process the large volumes of data generated by complex AI applications. SK Hynix, the main HBM supplier to Nvidia, was the leading player in the HBM market last year, with a 61% share, followed by Samsung Electronics at 19% and Micron at 20%, data from Macquarie Equity Research showed.