South Korean memory maker SK Hynix announced it will invest 19 trillion Korean won ($12.9 billion) to build a new advanced packaging plant, aiming to meet rising demand for memory chips linked to artificial intelligence (12/01).

The new facility will be located in Cheongju, expanding the company’s existing production footprint. Construction is scheduled to start in April, with completion targeted by the end of 2027, according to SK Hynix.

New Plant to Focus on High-Bandwidth Memory for AI

The Cheongju plant will specialize in advanced packaging, which combines multiple memory chips into a single high-density unit. This process enhances performance, energy efficiency, and reduces overall size.

SK Hynix is one of the world’s largest memory chip producers and a leader in high-bandwidth memory (HBM), used in artificial intelligence processors, including those developed by U.S. chipmaker Nvidia.

HBM Market Growth Drives Investment

SK Hynix cited industry projections showing the HBM market is expected to grow at a compound annual growth rate of 33% between 2025 and 2030. The company said this rising demand for HBM is driven by global AI competition, which has also increased prices, making the market more lucrative.

Rival Samsung Electronics has also announced plans to expand HBM production in recent months.

Memory Shortages and Market Impact

The shift to AI-focused memory production has caused shortages in conventional memory, raising concerns about price increases across the broader electronics industry.

SK Hynix shares have risen roughly 12% year-to-date but dropped 2.5% in trading on Tuesday.

PHOTO: CAIXINGGLOBAL

This article was created with AI assistance.

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