Global Tech Giants Continuously Visit SK hynix in Search of Next-gen DRAM

U.S.-based tech giant Meta (formerly Facebook) recently visited South Korea to discuss next-generation DRAM with SK hynix. Nvidia, an AI semiconductor company, is also planning a visit soon.

According to industry sources on Aug. 27, Meta officials visited the SK hynix headquarters in Icheon, Gyeonggi Province, on Aug. 24. During their visit, they inspected DDR5, high bandwidth memory (HBM) production facilities, and extreme ultraviolet lithography (EUV) at the Icheon campus and conducted a quality audit of DDR5.

Meta is one of SK hynix’s major clients, procuring enterprise solid state drives (SSDs) and server DRAM for data center construction and expansion. Meta, investing heavily in AI servers, has also reportedly requested additional supplies of high-performance, high-efficiency DDR5 server DRAM from SK hynix.

The industry is rife with speculation that the two companies discussed DDR5 supply during their meeting at the Icheon plant. The server DRAM is currently undergoing a rapid generational shift from DDR4 to DDR5 due to increasing AI demand. Earlier, SK hynix developed a 10-nanometer 4th generation (1a) DDR5 and, in January this year, achieved the world’s first compatibility certification with Intel’s new “Sapphire Rapids” CPU, thereby pioneering a new server memory market.

Nvidia is also expected to visit SK hynix’s Icheon campus this week. It’s anticipated that Nvidia will review SK hynix’s 5th generation HBM, the “HBM3E” production line. Given Nvidia’s known consideration to quadruple the production of its latest AI GPU, “H100,” discussions regarding additional HBM supplies are expected.

HBM is a product that enhances data processing speeds by vertically connecting multiple types of DRAM and is extensively equipped with GPUs used in AI chips. Currently, NVIDIA dominates more than 80% of the global GPU market.

SK hynix has had a collaborative relationship with Nvidia since the inception of the HBM market. Recently, SK hynix developed a new high-performance DRAM product for AI, HBM3E, and began supplying samples to Nvidia.

Meanwhile, SK hynix, which recorded a business loss of 6 trillion won in the first half of this year, is creating a new strategy to improve performance through next-gen DRAM. Visible results are gradually emerging. According to market research firm TrendForce, SK hynix, which had slipped to third place in the global DRAM market in the previous quarter, reclaimed the second spot this quarter, powered by an increase in shipments of next-gen DRAM like DDR5 and HBM. Notably, DRAM sales in the second quarter surged by 48.9%, amounting to US$3.443 billion, up from US$2.312 billion the previous quarter.