SK Hynix says memory shortages to persist until 2030

SK Hynix forecasts memory shortages will continue until 2030, a situation that bolsters the company's financial performance.

This outlook, detailed in Wednesday's quarterly results, stems from a belief that "a virtuous cycle has taken hold in which AI-driven productivity gains and new revenue generation in areas such as software development, customer service, and search lead to greater AI adoption, which in turn drives increased investment in infrastructure."

The firm anticipates heightened market demand for memory from autonomous vehicles and the expanding robotics sector in the years ahead. Despite efforts to build more fabrication plants, executives acknowledged that production expansion cannot keep pace with rising needs.

"The company assessed that supply … is not keeping pace with the growth of the market," SK Hynix informed investors. Furthermore, "Given technical difficulty of leading-edge processes and the long lead time required to build new production facilities, it expects the structure in which demand exceeds supply to persist through 2030.”

These projections come as SK Hynix secured 14 long-term deals with major purchasers, who collectively plan to acquire over half of its total output during 2027 and 2028.

However, the company's chief financial officer, Kim Woo-hyun, warned that the market will face headwinds elsewhere. He predicted that "shipment volumes for PCs and mobile devices are expected to decrease due to cost burdens from rising memory prices and supply shortages.”

To drive future growth, the company plans to increase HBM4 production, aiming for it to "surpass HBM3E in both shipment volume and revenue in the fourth quarter and … establish itself as a mainstream product.” They also intend to accelerate the use of their 10nm-class 6th generation (1c) process technology and boost sales of DDR5 and LPDDR5 SOCAMM for AI servers.