SK Hynix Shares Climb After $3.87 Billion AI Chip Facility Investment in U.S.
By Kwanwoo Jun
SK Hynix shares climbed Thursday after announcing a $3.87 billion artificial-intelligence chip packaging facility investment in the U.S. as it ramps up its efforts to lead the market for advanced memory chips.
The company, the world's second-largest memory-chip maker, saw its shares rise as much as 4.9% to 187,900 won ($139.65) early Thursday, outperforming the 1.1% gain for South Korea's headline stock benchmark.
The rally in SK Hynix more than offset its prior session's 3.8% loss, partly driven by investor jitters after a powerful earthquake hit Taiwan, the world's most important semiconductor-manufacturing hub, Wednesday.
SK Hynix supplies high-bandwidth-memory products to U.S. AI-chip titan Nvidia and other global technology companies.
Chief Executive Kwak Noh-Jung said after announcing the plan to build HBM production facilities in West Lafayette, Ind., as reported last week by The Wall Street Journal, that the industry's first advanced HBM packaging facility for AI products in the U.S. would help strengthen supply-chain resilience and develop a local semiconductor ecosystem.
SK Hynix plans to start mass production there in the second half of 2028.
The state of Indiana offered SK Hynix up to $554 million in tax rebates in addition to other incentives for the investment, according to Gov. Eric Holcomb's office.
Seoul-based Hi Investment & Securities analyst M.S. Song said in a research note that he expects SK Hynix to continue to dominate the market for HBM products, which are crucial for powerful-computing AI chip devices, thanks to brisk demand and to benefit from higher prices for such chips.
Prices for HBM3E, SK Hynix's most advanced product, are around 20% higher per gigabit and 80% higher per unit than the previous HBM3 model, Song reckoned.
Write to Kwanwoo Jun at kwanwoo.jun@wsj.com
(END) Dow Jones Newswires
April 04, 2024 00:17 ET (04:17 GMT)
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