Credits: Korea Herald

Memory giant SK Hynix has announced that it plans to invest the equivalent of US$74.6 billion in AI-focused technologies over the next few years until 2028. The information came through its parent company SK Group, which revealed the value in South Korea, its home country: 103 trillion won.

The investment’s focus on AI means more attention is being paid to its AI products. These include HBM chip production, data centers and AI services. Among the services, SK Hynix cites AI assistants as an example, which have been growing in popularity.

The company will invest the bulk of the billion-dollar amount by 2026. The plan is to inject 80 trillion won by then, while the company also “optimizes” its more than 175 subsidiaries. “Optimize” in this case means closing branches to reduce costs.

The strategy changes were announced in response to recent earnings losses for its group companies. SK Hynix, the world’s second-largest memory maker, has lost money for four straight quarters — essentially an entire fiscal year.

SK Group is optimistic about its new investments and streamlining of the conglomerate. Executives expect pretax profits of 22 trillion won this year, with a target of reaching 40 trillion won by 2026.

SK Hynix competes at home

The memory giant’s focus on AI is the solution that every tech company is looking for in the current hype about the feature. As such, SK Hynix has to compete not only with international giants like Nvidia, but even in its homeland, with Samsung.

However, while it rivals Nvidia in certain segments, the RTX owner may be one of SK Hynix’s most important customers in HBM. Even more so after recent statements by CEO Jensen Huang showing that he is not very excited about Samsung’s solutions.

For its future investments, SK Group may be counting on subsidies from the South Korean government. Earlier this year, according to Reuters, a 26 trillion won benefit package was offered to domestic chipmakers to encourage a return to Korean dominance in the international market.

Source: Reuters

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