SK Hynix shares soared more than 9% on Thursday following the company’s announcement of a breakthrough in high-bandwidth memory (HBM) chip technology.
The South Korean tech giant revealed it has started mass production of the world’s first 12-layer version of its HBM3E chips, marking a significant step forward in the race to develop advanced memory solutions for artificial intelligence (AI) applications.
This development has triggered a rally in chip stocks across the Asian market, with investors responding positively to the news and the wider global demand for AI-driven technology.
The new 12-layer HBM3E chip is the latest generation of dynamic random access memory (DRAM) designed specifically for high-end generative AI work.
By stacking chips vertically, HBM technology offers enhanced data processing speed and reduced power consumption, making it an ideal solution for AI chipsets.
SK Hynix, along with competitors like Samsung Electronics and Micron Technology, is one of the leading manufacturers of HBM chips.
Global chip demand fuels SK Hynix’s rally
The surge in SK Hynix’s stock price was bolstered not only by its product advancements but also by strong financial forecasts from US chipmaker Micron Technology.
Overnight, Micron issued an unexpectedly upbeat forecast for its fiscal first quarter, projecting profits of $1.74 per share on $8.7 billion in revenue.
This surpassed market expectations, which had predicted profits of $1.65 per share on $8.28 billion in revenue, according to consensus estimates from LSEG.
Micron’s optimistic outlook, driven by strong demand for HBM chips, further lifted investor sentiment in the global semiconductor sector.
As a result, chip stocks across Asia rallied on Thursday.
Tokyo Electron saw a 7% rise, while Advantest jumped 5%. Samsung Electronics, the world’s largest memory chipmaker, also gained more than 3%.
The benchmark South Korean Kospi index advanced by 2%, reflecting the positive momentum in the technology sector.
HBM3E chip boasts a 36-gigabyte capacity
SK Hynix’s latest HBM3E chip boasts a 36-gigabyte capacity, making it the largest and most powerful HBM chip currently in mass production.
The company highlighted that this represents a 50% increase in capacity compared to its previous eight-layer HBM chip, which began mass production in March.
Remarkably, despite the increase in capacity, the 12-layer chip maintains the same physical thickness, a feat that underscores SK Hynix’s technical prowess.
This new product is expected to play a critical role in AI-driven technologies, particularly for companies like Nvidia, which relies on high-bandwidth memory chips for its advanced AI processors.
SK Hynix has long been a key supplier of memory solutions to Nvidia and other global tech giants, and the new HBM3E chip is set to reinforce its dominance in the AI memory chip market.
SK Hynix’s position in AI chip market
As AI applications continue to expand across various industries, demand for high-performance memory chips is expected to grow exponentially.
SK Hynix’s latest advancement positions the company to meet this growing demand, particularly in the AI sector, where processing power and efficiency are critical.
The company plans to begin deliveries of its 12-layer HBM3E chips by the end of the year, further solidifying its leadership in the memory chip industry.
SK Hynix’s focus on AI technology and its ongoing efforts to innovate in the HBM space comes at a time when the global semiconductor market is transforming.
With AI and machine learning increasingly integrated into industries ranging from healthcare to autonomous vehicles, the demand for efficient, high-capacity memory solutions is expected to be a major growth driver for chipmakers like SK Hynix, Micron, and Samsung.
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