Key facts
- SK Hynix has become South Korea's most valuable company, surpassing Samsung Electronics.
- The company's success is driven by its early investment in High-Bandwidth Memory (HBM) chips.
- HBM chips are critical for AI applications, making SK Hynix a key supplier to Nvidia.
- SK Hynix plans to raise approximately $29.43 billion through a U.S. ADR listing.
- The proceeds will fund expansion of its investor base and AI chip production capacity.
SK Hynix has surpassed Samsung Electronics to become South Korea's most valuable company, driven by its strategic focus on high-bandwidth memory (HBM) chips essential for artificial intelligence. This achievement marks the culmination of a 14-year journey involving significant investment and overcoming skepticism.
SK Group acquired Hynix Semiconductor in 2012, a move met with concern given Samsung's dominance. SK Hynix concentrated on HBM, a niche memory chip offering faster data processing. Despite releasing the first HBM product in 2014, the company fell behind Samsung in HBM development in the late 2010s, leading to internal debate about halting the technology. However, SK Hynix doubled down, investing heavily in technology and production capacity, anticipating demand from companies like Nvidia.
A substantial investment in a packaging facility initially seemed a misstep, facing underutilization in 2019. The landscape shifted dramatically with the 2022 release of OpenAI's ChatGPT, triggering unprecedented demand for AI chips. SK Hynix's readiness positioned it as Nvidia's primary HBM supplier.
The company, which has navigated crises since its founding as Hyundai Electronics in 1983, reported an annual operating loss of 7.73 trillion won in 2023 but posted a record operating profit in 2024. SK Hynix is now preparing to list American Depository Receipts (ADRs) in the U.S. to broaden its investor base, with its shares rallying over 340% this year. SK Group Chairman Chey Tae-won has set ambitious market capitalization targets for SK Hynix, aiming for 1 quadrillion won and eventually 2 quadrillion won.