SK Hynix Chairman: Will expand AI memory chip production capacity to meet surging demand.

SK Group Chairman Chey Tae-won has promised to expand the production capacity of AI memory chips to meet the increasing demand brought by global data center construction. The head of South Korea's second-largest conglomerate referred to high bandwidth memory (HBM) as the "monster chip" that is bringing substantial profits to SK Hynix during a speech at a meeting in Washington on February 20. Thanks to record profits, the stock price of this chip manufacturer has more than tripled in the past year. While Chey Tae-won did not specify the scale of expansion for his chip company, SK Hynix stated in January that its capital expenditure for 2026 will increase significantly compared to the previous year to meet the demand for HBM chips. These chips are essential for accelerators designed by companies such as NVIDIA Corporation (NVDA.US) to train and run artificial intelligence services. From Microsoft Corporation (MSFT.US) to Meta Platforms (META.US), U.S. tech companies plan to allocate a total of around $650 billion this year for infrastructure construction to gain an advantage in the artificial intelligence technology race. This record spending is leading to a global shortage of memory chips, a market dominated by SK Hynix, its South Korean counterpart Samsung Electronics, and Micron Technology, Inc. (MU.US) from the U.S. All of SK Hynix's memory chip capacity for 2026 has been sold out, and the same is true for Micron Technology, Inc.'s HBM products. However, Chey Tae-won also warned that rapid technological changes could lead to shifts in the competitive landscape, potentially resulting in losses in the future. According to Chey Tae-won, analysts' average forecast for SK Hynix's annual operating profit in 2026 has increased from around $50 billion late last year to $70 billion in January, with some analysts even raising it to over $100 billion. "This does sound like good news," Chey Tae-won said, "but it could easily turn into a loss of $100 billion." Chey Tae-won also emphasized the increasingly severe infrastructure challenges. He stated that SK Group is currently exploring the construction of power plants next to AI data centers, as the inability to meet energy demands could be "disastrous."