SK Hynix, the world's leading producer of high bandwidth memory (HBM), plans to invest more than 20 trillion won (approximately $14.6 billion) in a new state-of-the-art semiconductor manufacturing facility (fab) in South Korea.
In a press statement issued on April 24, SK Hynix revealed that the company aims to meet the surging market demand for high-performance storage solutions and consolidate its leadership position in the industry. The new plant, called M15X, is located in Cheongju City, Chungcheongbuk-do, South Korea, and is expected to add capacity for next-generation Dynamic Random Access Memory (DRAM) and High-Bandwidth Memory (HBM) from this new production site.
In a statement, SK Hynix's CEO said, "M15X will be a key hub that will serve as a bridge connecting SK Hynix's current and future supply of AI memories globally. We firmly believe that this investment will be a giant leap forward not only for the company itself, but also for driving the future of the broader domestic economy."
With the advent of the AI era, SK Hynix said the memory industry has entered a medium- to long-term growth phase. In addition to HBM (High Bandwidth Memory), which is expected to grow at an annual rate of more than 60%, SK Hynix also predicts steady growth in demand for general-purpose DRAM (Dynamic Random Access Memory) as demand for high-capacity DDR5 module products for servers continues to rise SK Hynix is the HBM market share leader, with an HBM3 market share of more than 85% and an overall HBM market share of SK Hynix is the HBM market share leader, with over 85% of the HBM3 market share and over 70% of the overall HBM market share.
Industry sources said, "SK Hynix is investing to maintain its market share, especially in the HBM3E and HBM4 segments."
He noted that rivals Micron and Samsung are not currently at SK Hynix's level in terms of performance and energy efficiency. He added that while Samsung has significant production capacity in the HBM space, they have not yet been able to produce the fastest HBM3 products.
Figure 1: SK Hynix invests $14.6 billion in new production base
In an interview, the expert said, "The big question on everyone's mind right now is whether the current rapid development of AI is outpacing the market's long-term growth potential." He continued, "Public enthusiasm for large-scale language modeling may wane over time. Nonetheless, there is still growing interest in utilizing AI processors to improve the efficiency of AI tasks currently performed by standard servers, which include providing navigation, language translation, targeted advertising, and even basic search."
Since 2014, SK Hynix has invested 46 trillion won (about $33.4 billion) in three new semiconductor manufacturing plants - M14 in 2014 in Eui-seong, South Korea, M15 in 2018 in Cheongju, South Korea, and M16 in 2021, also in the Eui-seong Plant. The company recently announced an advanced packaging program for HBM in the United States.
In early April, the company said it signed an agreement with TSMC to develop and produce next-generation HBMs and enhance the integration of logic and HBMs through advanced packaging technology. SK Hynix plans to continue development of HBM4, the sixth-generation HBM family, through the partnership, with production scheduled to begin in 2026.
The goal of both companies is to improve the performance of the base chip mounted at the bottom of the HBM package. HBMs are made by stacking core DRAM chips on top of the base chip and stitching them together via silicon through-hole technology, which vertically connects multiple layers in the DRAM stack to the core chip as part of the HBM package. The base chip at the bottom connects to the GPU that controls the HBM.
SK Hynix already uses proprietary technology to manufacture the base chip for the HBM3E generation, but plans to use TSMC's advanced logic process to produce the HBM4 base chip so that additional functionality can be packaged into the limited space available. This will help SK Hynix customize HBM to meet a wider range of performance and energy efficiency requirements.
