Highlights
- AI memory shortages could continue well beyond 2030, according to SK Hynix.
- The company plans to expand its global chip production as it invests in new manufacturing facilities.
- Investors remain cautious despite strong AI demand and record memory profits.
The AI memory boom is not slowing down. According to SK Hynix CEO, Kwak Noh-jung, the industry's supply shortage could continue well beyond 2030 despite aggressive capacity expansion. His comments come as investors debate whether today's AI spending will sustain demand or eventually create oversupply.
Speaking to Reuters after the company's Nasdaq debut, Kwak stated that 2027 will likely be "the worst year in the industry's history from the supply perspective."
He pointed out that customer demand is growing faster than production capacity. "We still forecast that customer demand will remain higher than our supply capacity even beyond 2030," he added.
SK Hynix recently raised more than $26 billion USD through its U.S. listing, which was more than seven times oversubscribed. The company plans to use the proceeds to build a fabrication hub in Yongin and an advanced packaging facility in Cheongju. It is also evaluating future wafer fabrication sites in Japan, the United States, and Southeast Asia.
AI Demand Continues to Support Memory Chip Expansion
SK Hynix has become a major supplier of high-bandwidth memory chips used in Nvidia's AI platforms. The company reported a record ₩47 trillion (~$31.44B USD) operating profit in 2025. LSEG SmartEstimate projects another strong quarter with operating profit expected to reach ₩65.5 trillion (~$44B).
The wider industry is also expanding. Micron recently increased its planned U.S. investment to more than $250B through 2035. South Korea is pushing ahead with a large-scale semiconductor expansion involving SK Hynix and Samsung.
Meanwhile, Bank of America expects global hyperscaler capital expenditure to reach about $851B in 2026 and $1.15T in 2027. Nvidia CEO, Jensen Huang, has also noted that AI memory shortages could continue for several years, while UBS expects the DRAM market to remain undersupplied until at least the second quarter (Q2) of 2028.
Investors Remain Cautious Despite Strong AI Outlook
Not everyone expects the rally to continue uninterrupted. Morningstar analyst, Jing Jie Yu, reported that new capacity coming online in 2027 and 2028 could improve supply and pressure memory prices. Lorraine Tan of Morningstar also warned that AI monetization remains uncertain and funding is increasingly shifting toward debt and equity.
Those concerns have already hit chip stocks.
SK Hynix's stock suffered its biggest one-day decline in nearly 20 years after its Nasdaq debut. The Philadelphia Semiconductor Index has also climbed about 240% since the AI boom began, but has pulled back in July 2026 as investors reassess the sector's long-term outlook.
The contrasting outlook from chipmakers and investors underscores the uncertainty surrounding the next phase of the AI infrastructure boom.
