SK Hynix plans $28B US IPO to ride AI memory boom

SK Hynix, the South Korean memory chipmaker rivaling Samsung and Micron, announced plans to sell approximately 17.8 million shares in a US IPO via American depositary receipts (ADRs), each representing one-tenth of a common share. Based on its closing price in Seoul last Friday, the offering could raise around $28 billion, according to Bloomberg. The securities are expected to price Thursday and begin trading Friday on a US exchange. This move capitalizes on surging demand for memory chips driven by AI infrastructure, with SK Hynix reporting first-quarter revenues up nearly 200% year-over-year and its stock climbing 260% so far this year.

The AI boom has created a memory chip shortage—dubbed "RAMageddon"—as hyperscalers like Amazon, Microsoft, Google, and Oracle race to build data centers. High-bandwidth memory (HBM), DRAM, and NAND are critical for AI systems, and supply has struggled to keep pace. Apple has cited the shortage as a reason for raising Mac and iPad prices. In response, South Korean tech companies, led by SK Hynix and Samsung, have committed over $550 billion to new manufacturing capacity. However, this investment carries risk: by the time facilities are built, AI memory needs may shift, potentially leading to oversupply and crashing prices. For now, Wall Street views memory makers as the next Nvidia—Micron, the closest US comparison, has soared nearly 700% in the past year to a $1 trillion valuation.