LG Electronics shares rise on AI chipmaking equipment report

LG Electronics Inc. shares rose in Seoul following a local media report that the company is working on advanced equipment for producing memory chips used with AI processors from Nvidia Corp. and other firms.

The company has not disclosed a timeline for mass production, although a local media report indicates a target of 2028.

HBM chips consist of stacked DRAM chips that use hybrid bonders to create thinner and more efficient structures by directly bonding the electrodes of adjacent layers.

South Korea, which hosts SK Hynix, a major HBM supplier, is also home to various hybrid bonding equipment manufacturers.

These include Hanmi Semiconductor, Samsung Electronics’ Semes, and Hanwha Vision’s Hanwha Semitech unit.

Following reports of LG’s potential entry into the hybrid bonders market, shares of Hanmi Semiconductor, Hanwha Vision, and Samsung Electronics declined.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Hybrid bonding: The emerging foundation of AI chip infrastructure

The hybrid bonding market LG Electronics is entering represents a critical technology transition in advanced semiconductor manufacturing, particularly for AI applications.

This technology enables up to 7 million connections per square millimeter of silicon, creating the ultra-dense 3D chip stacking essential for high-bandwidth memory chips that power AI systems 1.

Multiple market analyses project significant growth for this technology, with estimates ranging from $0.7 billion by 2033 at a 15.2% CAGR 2 to more ambitious projections of $756 million by 2031 at a 24.7% CAGR 3.

The technology’s importance stems from its ability to eliminate traditional bump connections by directly bonding copper-to-copper at sub-10 μm pitches, creating thinner, higher-performing memory stacks 4.

This advancement is particularly crucial for high-bandwidth memory (HBM) used in AI processors, where performance demands are driving the need for increasingly dense memory-logic integration.

With semiconductor scaling facing physical limitations, hybrid bonding has emerged as the fastest-growing segment of advanced packaging, enabling continued performance improvements through 3D integration rather than traditional transistor shrinking.