April 18, 2025 /SemiMedia/ — SK Hynix said on Wednesday it plans to invest more than 20 trillion won ($13.7 billion) this year to expand its high-bandwidth memory (HBM) production capacity, marking its largest-ever annual capital expenditure.

The investment underscores the company’s strategic focus on scaling up manufacturing of HBM chips, which are in high demand for powering artificial intelligence (AI) accelerators and high-performance computing systems. SK Hynix, a key supplier to Nvidia, currently provides 8-layer and 12-layer HBM3E products, and aims to further strengthen its yield and production capabilities.

“In 2024, our capital spending will increase from last year, with a clear focus on HBM,” the company stated during its earnings call. Last year’s investment reached nearly KRW 18 trillion, driven by surging AI data center demand.

As generative AI models grow in size and complexity, the need for high-throughput, energy-efficient memory has intensified. HBM plays a crucial role in meeting these requirements, and SK Hynix is positioning itself to lead this segment amid a booming market.

According to Counterpoint Research, SK Hynix claimed the top spot in the DRAM market in Q1 2024 with a 36% revenue share, surpassing Samsung Electronics’ 34%. Analysts attribute this shift largely to HBM’s higher profitability and strategic relevance in AI applications.

This expansion effort builds on SK Hynix’s history of counter-cyclical investments. The company first surpassed KRW 10 trillion in annual capex in 2017, and ramped up spending during the 2018 memory boom and again in 2022 during the pandemic-driven surge. Its 2024 HBM-focused investment signals a long-term bet on next-generation semiconductor competitiveness.