SK Hynix says memory shortages to persist until 2030

In remarks published on Wednesday alongside its quarterly results, the company offered its 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.” SK Hynix thinks this is great news, because it means more buyers are entering the market for AI infrastructure, including “general enterprises” and nations building sovereign infrastructure. In coming years, the company sees even more demand for memory coming from autonomous cars and the growing robotics market. While the company is working hard to build more factories and get them working, execs admitted it can’t do that fast enough to meet demand. “The company assessed that supply … is not keeping pace with the growth of the market,” SK Hynix told investors. “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.” It gets worse. SK Hynix has 14 long-term deals with 14 big buyers, who will collectively buy more than half of its output during 2027 and 2028, and some of them want to extend those agreements. The Korean giant doesn’t mind that because the deals include “a mechanism that reflects market conditions within a price range agreed upon with customers” and give it “a structure that secures stable profitability while allowing flexible responses to market changes.” Those deals helped SK Hynix to record quarterly revenue of ₩104.6 trillion ($78.1 billion), up 328 percent year-over-year and 32 percent quarter-over-quarter. Operating profit came in at ₩87.68 trillion ($62.8 billion), up 486 percent year over year.