Will the worst “core shortage” in history come next year? SK hynix CEO: Supply will continue to exceed demand in the next ten years
[Will the most serious “core shortage” in history come next year? SK Hynix CEO: Supply will continue to exceed demand in the next ten years] On Friday, Eastern Time, on the day of South Korean storage giant SK Hynix’s debut on the U.S. Nasdaq, its CEO Guo Luzheng said that the global storage industry is expected to face the most serious supply shortage in history in 2027. He also emphasized that although the company is vigorously expanding production, it predicts that storage demand will continue to exceed its production capacity for a long time within the next ten years.
On Friday Eastern Time, on the day that South Korean storage giant SK Hynix made its debut on the U.S. stock market Nasdaq, its CEO Guo Luzheng said that the global storage industry is expected to face the most serious supply shortage in history in 2027. He also emphasized that although the company is vigorously expanding production, it predicts that storage demand will continue to exceed its production capacity for a long time within the next ten years. The biggest storage shortage in history is coming next year On Friday Eastern Time, Guo Luzheng told the media: "We expect next year to be the tightest supply year in the history of the industry...Customer demand continues to grow while our capacity is constrained. We still expect customer demand to be higher than our supply capacity even beyond 2030. But we are doing our best to address this issue." Kuo's remarks came after the South Korean chipmaker's successful listing. SK Hynix has become a key player in the artificial intelligence supply chain with its leading position in the development of HBM used in Nvidia chipsets. As of Friday's close, SK Hynix's shares closed up 12.76% on Nasdaq on its first day, corresponding to a market value of US$1.22 trillion. U.S. fabs under consideration Guo Luzheng also said that the United States is still one of several candidates for its future wafer manufacturing investment, although no decision has been made yet. He said the company will give priority to areas that can provide sufficient land, power, water and skilled workers, as well as competitive manufacturing costs. "If these conditions are met, the United States, Japan and Southeast Asia are all under consideration," Guo said. "No decision has been made yet and we are evaluating which location will bring the greatest commercial advantages." In addition to expanding its overseas production base, SK hynix currently has its main factories in Icheon and Cheongju, where its headquarters is located, and is building a large facility in Yongin City. Recently, both SK Hynix and Samsung Electronics participated in a South Korean government plan to double the country's memory chip production capacity within five years. The plan includes investing 400 trillion won (approximately $266 billion) in each of southwestern South Korea to build chip production facilities. However, the plan has unsettled some investors, who worry that these storage companies will face greater risks should the economy downturn. In the United States, SK Hynix is investing approximately US$4 billion to build an advanced chip packaging factory in Indiana. At the same time, it also plans to invest US$10 billion to develop an artificial intelligence solutions company in the United States, aiming to find new AI growth engines. Artificial intelligence needs face scrutiny Nonetheless, there is speculation that the artificial intelligence investment cycle is approaching a turning point, which is why global chip stocks have been under pressure recently. Concerns have grown amid news that Meta is trying to commercialize excess artificial intelligence computing power. However, industry executives and analysts note that memory supply continues to lag demand. Nvidia CEO Jensen Huang said last month that the artificial intelligence memory shortage will last for several years due to strong demand, adding that SK Hynix will continue to be the company's largest memory supplier. UBS also predicts that the global DRAM industry will remain in short supply until at least the second quarter of 2028. Similarly, Bank of America is optimistic about the artificial intelligence investment cycle, predicting that capital expenditures by global hyperscale cloud computing companies will reach approximately US$851 billion this year and will increase to US$1.15 trillion next year, mainly due to strong cloud service orders, increased return on artificial intelligence investment, and growing demand for computing-intensive AI applications. The bank said the roughly $244 billion raised by leading hyperscalers this year largely reflects balance sheet optimization rather than signs of financing stress, stressing that capital remains sufficient to support continued infrastructure investment. On Thursday, Micron further strengthened this optimistic expectation. The company said it planned to invest more than $250 billion in the United States by 2035, an increase from the $200 billion plan announced last year. It cited the surge in demand for memory chips in the artificial intelligence era and U.S. President Trump's push to strengthen domestic semiconductor manufacturing. (