SK Hynix to boost memory production 3x ... you can wait another 8 years, right?

Amid the unrelenting demand for AI infrastructure, SK Hynix, the world’s largest supplier of HBM memory used in high-end GPUs, now expects to triple its wafer capacity. You'll just have to wait through two more US presidential elections and then some. All that capacity won’t come online until 2034, SK Group Chairman Chey Tae-won told Nikkei Asia in a recent interview. SK Hynix’s valuation has soared in recent months. The company is one of three major producers of NAND flash and DRAM memory, large quantities of which are required to support the burgeoning AI inference market. Samsung and Micron are the other two major players in this space. This demand has led to skyrocketing memory prices for consumer DRAM and SSDs, some of which have more than tripled in price compared to this time last year. SK Hynix and the other major memory makers meanwhile have seen their revenues explode. Chey's comments come just a week after SK Hynix said that it planned to double its production capacity within the next five years. “Our calculations show that our wafer capacity will double within five years. But honestly once all these facilities are built, it won’t just double, it will triple by around 2034,” Chey told Nikkei. SK is in the process of bringing four additional wafer fabs online, with the first phase reportedly on track to come online as early as 2027. The South Korean memory slinger had previously planned to ramp production of these facilities over the next two decades, but has pulled in its timeline in hopes of satiating AI’s memory addiction. “There is currently no way to move faster than this,” Chey told the newswire. While much of this capacity will be built on SK’s home turf, the company is exploring its options for overseas manufacturing, with Japan being one of the potential destinations, with Chey calling it an “excellent” candidate due to its robust semiconductor supply chains. Unfortunately, the buildout is unlikely to drive down memory prices for consumers any time soon. As we previously reported, memory prices are not expected to peak until later this year at the earliest. Analysts warn that memory prices are more likely to plateau going into 2027 rather than plummeting like we’ve seen in past DRAM and NAND boom-bust cycles. These boom-bust cycles have been a fact of life for commodity electronics manufacturers, like SK Hynix and Samsung, for years. Prices typically spike as inventories are drawn down and crater as new capacity is brought online. On the one hand, AI infrastructure demand has helped to stabilize this to some extent. On the other hand, the AI boom kicked off in 2022 at what was arguably the worst possible time. "This demand started in the Valley for the DRAM industry. That makes financially trying to build additional capacity really challenging," TechInsights analyst James Sanders told El Reg late last year. Business is once again booming for memory vendors presenting ample opportunities for labor disputes over competition as well as fab expansions. Unfortunately, there’s no changing the fact that the fastest anyone can bring a leading edge memory fab online is about three years. ®