South Korean chip maker SK Hynix set to invest £58.7B in AI chips
Written by Finbarr Toesland Thu 4 Jul 2024
Image Credit: ReutersOne of the world’s largest chipmakers, SK Hynix, has announced plans to invest around £58.7 billion ($75 billion) in its chips organisation by 2028.
As the demand for chips is only set to increase in the near future, SK Hynix is hoping this investment will improve its position in the market and ensure the organisation can meet the high production demands for memory chips.
Alongside its investment in chips, SK Hynix is looking to spent funds to enhance its artificial intelligence (AI), high bandwidth memory (HBM) chips and AI services offerings. Announced over a two-day strategy meeting, SK Hynix set out to discuss how to restructure the massive organisation that is said to be made up of 219 companies.
The South Korean tech giant has made a number of large investments in recent years, including opening a new £3 billion ($3.86 billion) dynamic random access memory (DRAM) chip factory in South Korea, as well as a £3 billion ($3.87 billion) advanced chip packaging manufacturing site in the US.
After recording profits for ten years, in 2022 SK Hynix reported operating losses of close to £2.3 billion ($3 billion). Thanks in part to the massive growth of the AI sector, the business managed to recover from these losses in the final quarter of 2023.
Earlier in the year, the South Korean Government offered chip businesses in the country a massive £19.5 billion ($25 billion) support package, intended to help companies in the sector compete on the global level. This support comes at a time when businesses in the global semiconductor marketplace are fighting to retain marketshare in areas as diverse as chip designs and manufacturing.
In a bid to remain competitive, SK Hynix is looking to streamline its subsidiaries and focus on where it is most profitable, to ensure that it does not become unprofitable again in the near future.
Written by Finbarr Toesland Thu 4 Jul 2024