SK Hynix, the second-largest chipmaker in South Korea after Samsung, has announced plans to invest $74.6 billion in the next three years to advance memory chip technologies focused on artificial intelligence (AI). Additionally, its parent company, SK Group, aims to secure an additional $57.8 billion by 2026 to further support its AI initiatives. The move comes as SK Group has experienced significant losses from its subsidiary, Hyinx, and its vehicle battery business. If successful, the total investment will amount to nearly $133 billion. SK Group believes that these investments and the increased focus on AI will help recover the losses and ensure the company’s financial future.
This shift towards AI will also allow SK Group to streamline its operations by reducing the number of subsidiaries, which currently stands at over 175, to align with the group’s targets and ambitions.
While the enterprise-level AI market is dominated by big tech companies like Google, Microsoft, and Nvidia, the semiconductor market is more competitive. Though Microsoft, Nvidia, and Apple are vying for the title of the world’s most valuable company, the chipmaker market extends beyond Silicon Valley. The demand for chips, particularly those capable of training AI systems, has surged as more technology companies enter the AI arena and big tech organizations continue to push boundaries, resulting in a global chip shortage.
SK Group expects its investment strategy to increase profits from an estimated $16 billion in 2024 to nearly $30 billion by the end of 2025.