SK Hynix shares extend gains to over 2-decade highs as parent group reportedly plans AI data center

Shares of South Korea's SK Hynix have surged to their highest level in over 20 years, fueled by exciting news about the parent company's ambitious plans for the country's largest AI data center. The stock rose nearly 3% on Tuesday, building on a remarkable 50% increase this year, largely driven by the booming AI sector. Reports indicate that SK Group, the parent company of SK Hynix, is collaborating with Amazon Web Services to establish this cutting-edge AI data center in Ulsan. The initiative is being spearheaded by SK Telecom and SK Broadband, with significant backing from other affiliates, including SK Hynix itself. SK Hynix has solidified its position as a key player in the semiconductor market, particularly as a leading supplier of dynamic random access memory (DRAM), essential for PCs, workstations, and servers. In contrast, rival Samsung has seen its growth lag behind, with its shares climbing only 4% recently. Samsung Electronics faced a decline in market capitalization, hitting a nine-year low of 345.1 trillion won ($252 billion) as it struggles to meet the surging demand spurred by AI. Meanwhile, SK Hynix has emerged as a frontrunner in high bandwidth memory (HBM), a specialized DRAM critical for AI servers, and boasts impressive contracts with major clients like Nvidia. Recent research from Counterpoint highlighted SK Hynix's dominance in the HBM market, capturing an astounding 70% revenue share in the first quarter. This achievement has enabled SK Hynix to surpass Samsung in the overall DRAM market for the first time, claiming a 36% global market share compared to Samsung's 34%.