SK Hynix pledges $38 billion to build two new DRAM and NAND factories

The company said the new fabs will help it keep pace with the explosive demand for memory products.

SK Hynix has announced that it will invest 54 trillion Korean won ($38.1 billion) to build two new memory chip facilities in South Korea. The company, which is the second largest RAM and NAND chip manufacturer after Samsung, said the new fabs will help it keep pace with the explosive demand for memory products caused by the AI data center boom . The first cleanroom will start production as early as June 2029, SK Hynix officials said.

The company said it would invest 35.2 trillion won ($24.9 billion) in a Yongin fabrication plant to produce HBM and other DRAM products, and 19.1 trillion won ($13.2 billion) for a facility in Cheongju that will manufacture NAND storage chips. "This investment is a decision made to seize opportunities in line with the market's growth speed... we reached this investment decision after a thorough review of market demand," a SK Hynix official said in a statement.

The new facilities seem like a no-brainer, given the incredible demand for AI memory products that has caused prices to explode . These higher prices have generated incredible profits for companies like Samsung, SK Hynix and Micron, while causing prices for consumer products like smartphones, consoles and PCs to soar.

With the new fabs, SK Hynix is betting that this AI boom will continue, despite increasing analyst fears that the bubble may burst. The extra manufacturing isn't coming on line for several years, though, so don't expect to see prices drop anytime. "With demand growing even faster than planned capacity, memory prices are unlikely to soften before the end of 2028," Counterpoint Research analyst Neil Shah told CNBC .

There's another reason PC builders and others may not see price relief anytime soon. In a quest for higher profitability, manufacturers like Samsung and SK Hynix are allocating the majority of their chips to data center companies. Micron, for one, famously abandoned the consumer memory market to focus exclusively on AI products.