SK Hynix CEO warns: Memory chip shortage will continue beyond 2030

Kuai Technology reported on July 11 that on July 10, local time, SK Hynix completed the listing of a US$26.5 billion (approximately 180.2 billion yuan) ADR on Nasdaq. The issue price was US$149. The closing price on the first day surged 12.76%, with a total market value of US$1.22 trillion (approximately 8.30 trillion yuan). SK Hynix CEO Guo Luzheng said that the current shortage of memory chips that is impacting the computer, automobile and consumer electronics markets will most likely continue after 2030. The current construction of AI computing power infrastructure has generated massive demand for HBM, general-purpose DRAM and NAND. There are rigid upper limits on wafer manufacturing, EUV equipment, and advanced packaging production capacity. Short-term new production capacity cannot match the continued explosion of procurement demand. Downstream cloud manufacturers, terminal brands, and car companies all predict long-term chip shortages and have signed long-term supply agreements for more than five years. 60% to 70% of the company's planned shipments have been locked in long-term agreements, which confirms the long-term expectations of tight market supply. The expansion of global AI computing power has given priority to high-end storage production capacity. HBM orders continue to be saturated, diverting a large amount of wafer manufacturing resources. General terminals such as mobile phones, PCs, and automotive electronics are simultaneously facing the pressure of insufficient chip supply. The pressure of upstream storage price increases continues to be transmitted to downstream consumer electronics. Some institutions have previously predicted that the DRAM supply and demand gap will remain at least until the second quarter of 2028. Hynix’s current judgment will further lengthen the shortage cycle expectations. In order to alleviate the long-term supply and demand imbalance, SK hynix will invest all the funds raised from this listing into production capacity expansion and simultaneously promote multiple large-scale investment plans at home and abroad. South Korea's Yongin Semiconductor Cluster continues to increase investment, with a total investment of more than 31 trillion won (approximately 211.5 billion US dollars, equivalent to 1.44 trillion yuan), and the first HBM wafer fab will be put into operation in 2027; Cheongju has laid out tens of billions of won-level NAND and advanced packaging production lines; Indiana, the United States, has invested 3.87 billion US dollars (approximately 26.3 billion yuan) to build an overseas HBM packaging base, and the entire expansion target is to double the overall wafer production capacity within five years.