On June 30, SK Hynix, the world's second-largest memory chip manufacturer from South Korea, announced plans to invest ₩103 trillion (approximately $74.8 billion) by 2028 to strengthen its chip business, with a focus on the artificial intelligence (AI) sector.

Eighty percent of this investment (nearly $60 billion) will be allocated to high-bandwidth memory (HBM) chips to enhance SK Hynix's AI semiconductor manufacturing capabilities, aiming to "improve competitiveness by focusing on the AI value chain." Additionally, the funds will be used for shareholder returns and streamlining the operations of SK Group's 175 subsidiaries.

Meanwhile, SK Group's subsidiaries, including mobile operator SK Telecom and internet service provider SK Broadband, will jointly invest $2.46 billion in the AI data center business over the next five years.

Earlier, SK Group Chairman Chey Tae-won and over 20 senior executives convened a two-day annual strategic meeting aimed at revitalizing the group's business following significant losses in its primary profit driver, the electric vehicle battery sector. Discussions centered around reforming the group and devising future plans.

SK Group stated its intention to enhance competitiveness by focusing on the AI value chain, including HBM chips, AI data centers, and personalized AI assistants. Chey Tae-won emphasized in a statement that proactive fundamental changes are necessary during this transformation period.

In addition to substantial investment plans, SK Group plans to streamline its subsidiaries. Reports indicate that the number of subsidiaries will be adjusted to a "manageable range" to improve overall operational efficiency, although specific reduction scales have not been disclosed.

SK Group has set a target revenue of ₩800 trillion by 2026 through group operations and business reforms, with a commitment to achieving a free cash flow of ₩300 trillion within three years and maintaining a debt ratio below 100%.

According to the statement, SK Group incurred a loss of ₩10 trillion last year but anticipates pre-tax profits of ₩220 trillion this year, aiming to increase pre-tax profits to ₩400 trillion by 2026 to reverse the loss trend.

According to reports, SK hynix is the world's second-largest memory chip manufacturer after Samsung Electronics and a major supplier of HBM. In 2013, the company developed the world's first HBM chip and subsequently introduced HBM2, HBM2E, and the latest fourth-generation HBM3 chips in the following years.

In April 2023, SK hynix unveiled the world's first 12-layer HBM3 DRAM product, boasting the industry's largest capacity of 24 GB. By August 2023, the company launched the industry-leading fifth-generation HBM DRAM, HBM3E, optimized for AI applications, and provided samples to its customer Nvidia for performance evaluation.

In March of this year, SK hynix began mass production of HBM3E chips and announced plans to advance the mass production of the sixth-generation HBM4 chips to 2025.

Analysts note that Nvidia's GPUs currently dominate the AI server market, with SK hynix's HBM chips serving as essential components for these AI servers. Recently optimized for Nvidia's AI accelerators and leveraging its leading position in chip stacking technology, this investment is expected to further enhance SK hynix's leadership in the AI memory market.

This marks SK Group's first disclosure of its investment plan through 2028. However, SK hynix has already initiated several initiatives, including a $3.87 billion investment in Indiana, USA, for an advanced packaging facility and AI product research center, as well as a $14.6 billion investment in a new chip storage park in South Korea, along with ongoing domestic investments such as the Yongin semiconductor cluster.

Earlier this year, the South Korean government announced a comprehensive support package of ₩260 trillion (approximately $19 billion) to attract further investments from SK hynix and Samsung Electronics, among other local chip companies.