Samsung and SK Hynix stock prices plunged as China's domestic DUV lithography machines entered service, posing competitive threat to Korean memory exporters.

Samsung Electronics fell 13.4% on Tuesday, recording its worst one-day decline in nearly two decades, while SK Hynix, a leading supplier of high-bandwidth memory chips for AI systems, dropped 14.7%. The combined selloff pushed South Korea's KOSPI index down 10.8%, marking its largest single-day decline since early March, when the U.S.-Iran conflict escalated.

Investor concerns centered on AI-infrastructure financing, semiconductor valuations, and intensifying competition from China. Reports that Chinese companies were developing domestic deep-ultraviolet lithography equipment raised the prospect of rapid capacity expansion by Chinese memory producers.

SK Hynix's U.S.-listed shares had also fallen 7.5% to $143.02 on Monday—the first finish below the $149 listing price since the company's Nasdaq debut in July. This matters particularly because SK Hynix supplies HBM chips to Nvidia, making its earnings highly sensitive to AI spending expectations and demand for advanced processors.

Samsung and SK Hynix together represent nearly half of the KOSPI's weighting, amplifying the index's reaction to their double-digit declines. The market is now focused on SK Hynix's earnings report Wednesday—its first results since the Nasdaq listing—where investors will assess whether performance supports current HBM expectations and whether China's emerging lithography technology can achieve the reliability, performance, and commercial scale needed to meaningfully intensify competition.