Samsung, SK hynix expand facilities as AI demand grows

South Korea’s semiconductor companies, Samsung Electronics and SK hynix, are increasing investments in their facilities to prepare for growth in the AI chip market.

This expansion comes as the demand for advanced memory chips rises significantly.

Samsung Electronics is resuming construction on its Pyeongtaek Campus Line 4 (P4), which was halted last year.

Phase 4 will focus on producing sixth-generation 1c DRAM chips using a 10-nanometer process for next-generation high bandwidth memory (HBM4) chips.

Once operational, phase 4 is expected to have a monthly capacity of 80,000 wafers, which represents 40% of P4’s total monthly capacity.

SK hynix is also advancing with its own expansions. The company plans to complete its M15X plant in Cheongju later this year, which will manufacture fifth-generation 10nm-class DRAM chips targeting HBM4 production.

🔗 Source: The Korea Herald

🧠 Food for thought

1️⃣ Korean semiconductor dominance built through decades of strategic government support

South Korea’s current semiconductor leadership position wasn’t accidental but resulted from deliberate long-term policy planning beginning with the Electronics Promotion Act of 1969, which incentivized electronics manufacturing and laid groundwork for future chip dominance 1.

Samsung’s journey in semiconductors began in 1974 when it invested in Hankook Semiconductor, eventually becoming the global leader in memory chips by 1993 through sustained focus on DRAM technology 1.

SK Hynix’s story involves a dramatic turnaround after struggling financially until SK Group acquired a significant stake in 2012, resulting in a 180% revenue increase over the following five years 2.

The current expansion announcements follow a historical pattern of bold investments, exemplified by Samsung’s 2014 commitment of $14.7 billion to build what was then the world’s largest semiconductor facility in Pyeongtaek 3.

These latest manufacturing expansions represent not just reactions to current market opportunities but the continuation of a multi-decade national strategy that has secured South Korea’s position as the world’s second-largest semiconductor producer 4.

2️⃣ Shifting competitive dynamics as SK Hynix overtakes Samsung in AI memory race

SK Hynix has achieved a historic milestone by overtaking Samsung in DRAM market share for the first time, reaching 36% compared to Samsung’s 34% as of Q1 2025 5.