Over $1.3 Trillion for Memory Production: Announcements from Samsung and SK Hynix
Samsung and SK Hynix are preparing to launch one of the largest investment programs ever planned in the semiconductor industry. The two South Korean companies intend to decisively strengthen the production of DRAM memories, NAND Flash, High Bandwidth Memory (HBM)—a technology increasingly in demand by artificial intelligence systems and data centers—and advanced packaging solutions.
The plan, spread over approximately ten years, could reach a total value exceeding $1.3 trillion, although some rumors suggest an even higher figure. According to available information, Samsung and SK Hynix would contribute with investments of similar amounts, although the funds will be distributed differently among new factories, supporting infrastructure, research and development, and the expansion of existing production lines.
The province of Gwangju, located in the southwestern part of South Korea, is indicated as one of the main hubs intended to host the new investments. SK Hynix plans to build four to five production plants here, along with new facilities dedicated to packaging in the southern part of the Chungcheong province. Samsung will follow a similar strategy, constructing four or five additional plants spread between Gwangju and the Honam region. The company will also expand NAND Flash production in the northern province of Chungcheong. Meanwhile, Samsung Electro-Mechanics will increase the production capacity of multi-layer ceramic capacitors (MLCC) and substrates in the Yeongnam and Busan areas, components that continue to see high demand.
According to the Korea JoongAng Daily, in the initial phase, Samsung and SK Hynix will collectively invest $520 billion, equivalent to 800 trillion won, to build two new facilities each. This figure is supplemented by 81 trillion won allocated for the packaging sector and an additional 30 trillion won to develop future-oriented storage solutions, including HBM memories. The program also encompasses further investments for data centers, which will absorb another 550 trillion won.
Additionally, as reported by ZDNet, one of the main objectives also includes accelerating work in the Yongin semiconductor district. The new factories will be built concurrently rather than sequentially, thanks to the support of the South Korean government for the necessary infrastructure. This arrangement will allow for the completion of the plants three or four years ahead of schedule and double production capacity within five years.
The expansion comes at a particularly favorable time for the memory sector. Samsung and SK Hynix are recording very positive financial results and are allocating a significant portion of their profits to the development of new infrastructure. At the same time, some major customers in the industry have expressed concerns over rising memory prices, attributed to strong demand and limitations of current production capacity. According to rumors reported in the initial text, Apple is considering new initiatives to expand its supply sources, also contemplating Chinese manufacturers.
Executives from both companies have confirmed the extent of the planned financial commitment. The CEO of SK Group stated that the company will invest approximately $710 billion in production facilities, along with additional resources dedicated to data centers for artificial intelligence. Samsung, considering all group activities, expects investments even higher over the next decade, distributed between memory production, infrastructure, and related technologies.
If the program proceeds as scheduled, Samsung and SK Hynix will significantly increase the production capacity of the South Korean memory industry, with an expansion that will impact the entire supply chain, from chip production to advanced packaging and dedicated data center infrastructure.