- SK Hynix will spend 19 trillion won on a new packaging facility to boost memory chip output for AI workloads.
- The plant reflects broader industry moves to secure advanced packaging capabilities and reinforce semiconductor supply chains.
What happened: New facility to serve AI-driven memory growth
South Korea’s SK Hynix said on 13 January that it intends to invest 19 trillion won (about $12.9 billion) on an advanced chip packaging plant in South Korea, with construction slated to begin in April and completion targeted by the end of 2027.
The company told Reuters the move is aimed at addressing accelerating global demand for memory chips tied to artificial intelligence applications, particularly high-bandwidth memory (HBM) used in AI accelerators and data-intensive computing.
HBM is a stacked form of dynamic random-access memory (DRAM) designed to deliver the throughput and energy efficiency required by modern AI workloads; SK Hynix was the leading supplier globally in 2025, with roughly 61 % market share in HBM.
The new facility will expand SK Hynix’s backend packaging capacity at a time when memory makers are under pressure to supply AI hardware makers such as Nvidia and others with larger volumes of advanced memory.
Also Read: Coupang pledges $1.18 billion in vouchers after massive South Korean data breach
Also Read: South Korean L&F slashes value of Tesla battery material supply deal to $7,386
Why it’s important
Advanced packaging — the process that integrates and prepares chips for use in devices — is increasingly seen as strategic in the semiconductor value chain, especially for AI-oriented products. By boosting its domestic packaging footprint, SK Hynix is positioning itself to better control production quality and timelines for the memory modules that feed AI systems.
This follows global industry trends where chipmakers are both expanding packaging capabilities at home and abroad to mitigate supply chain risks and optimise logistics. For example, SK Hynix has previously announced plans for a packaging and R&D facility in the United States, part of wider efforts to serve AI markets and align with reshoring incentives.
The investment also underlines South Korea’s role as a cornerstone of the global semiconductor ecosystem. Alongside giants like Samsung Electronics, SK Hynix’s expansion reinforces the country’s leadership in memory technology — a sector critical to AI performance and competitiveness.
