SK Hynix approved a $38 billion investment in two new memory fabs to expand AI chip capacity.
SK hynix Inc., a major data center memory supplier, has approved construction of two new fabrication plants through its board of directors. The initiative will cost 54 trillion South Korean won, approximately $38.3 billion, and is part of a broader $430 billion investment plan designed to expand SK hynix's manufacturing capacity. This effort, in turn, is itself a component of a multibillion-dollar push by the South Korean government to grow the local chip sector—an initiative that also includes SK hynix rival Samsung Electronics Co.
The newly announced construction will include a $25 billion fab called Yongin Y2, the second of four chip factories that SK hynix plans to build at the Yongin Semiconductor Cluster, a manufacturing campus approximately 20 miles south of Seoul. The first fab in the series is expected to open in February. SK hynix plans to break ground on Yongin Y2 in July 2027, with the facility's first cleanroom scheduled to come online in June 2029. Once construction is complete, the factory will have 279 acres of floor space.
Yongin Y2 will be dedicated solely to DRAM manufacturing, with particular focus on HBM memory—the high-speed RAM used by graphics cards to store artificial intelligence models and their data. SK hynix is the world's largest HBM producer. HBM chips comprise multiple layers of RAM stacked atop one another, an arrangement that enables high-speed data movement to and from attached AI chips. The company debuted its most advanced HBM device, a 12-layer chip, last September, based on HBM4 technology that provides more than twice the bandwidth of memory currently powering today's graphics cards.
The second new fab will manufacture NAND flash memory and will be built on a campus that already hosts three of SK hynix's chip factories. According to SK hynix, the existing power and water infrastructure on the site will accelerate construction timelines, with the facility's first cleanroom expected to open in December 2028. Earlier this year, SK hynix and partner SanDisk introduced HBF, a new NAND flash technology that stacks NAND flash circuits atop one another in a manner similar to HBM. According to the companies, the technology can match HBM performance while providing up to 16 times more capacity.
Samsung, SK hynix's leading rival in the memory market, is also pursuing vertical memory technologies. On Wednesday, Samsung debuted two new technologies that enable stacking NAND and HBM memory directly atop logic circuits, shortening the distance between components and enabling faster data travel. The result is increased processing speeds. Samsung estimates its stackable HBM technology will be eight times faster than HBM5, an upcoming HBM version set to launch toward the end of the decade, with a tenfold increase in memory density. Samsung will offer customers the option to further optimize the technology by adding custom interconnect components.