SK Hynix says readying HBM4 production as it seeks to retain lead over rivals

By Heekyong Yang

SEOUL, Sept 12 (Reuters) - SK Hynix 000660.KS said on Friday it has completed its internal certification process for next generation high-bandwidth memory 4(HBM4) chips and established a production system for customers as it seeks to retain a lead over rivals.

In March, the South Korean chipmaker, a key supplier to AI giant Nvidia NVDA.O, said it had shipped its HBM4 12-layer chip samples to customers, adding that the company aims to complete preparations for mass production of 12-layer HBM4 products within the second half of this year.

HBM - a type of dynamic random access memory or DRAM standard first produced in 2013 - involves stacking chips vertically to save space and reduce power consumption, helping to process the large volumes of data generated by complex AI applications.

Kim Sunwoo, a senior analyst at Meritz Securities, projected that SK Hynix's HBM market share will remain in the low 60% range in 2026, compared to this year's 66% market share, supported by early HBM4 supply to key customers and the resulting first-mover advantage.

SK Hynix is currently the main HBM supplier to Nvidia, although Samsung Electronics 005930.KS and Micron MU.O supply it with smaller volumes.

Shares of SK Hynix closed at a record high, rising 7% to finish at 328,500 won ($236.71), outpacing the benchmark KOSPI's 1.5% rise, as analysts cited the company's HBM4 chip production plans. Samsung Electronics closed up 2.7%.

"Samsung Electronics has trailed in the HBM race so far, but is aiming to narrow the gap by adopting the more advanced 1c-nanometer node, compared with rival SK Hynix’s 1b-nanometer process for HBM4 chips," said Ryu Young-ho, a senior analyst at NH Investment & Securities.

Ryu added that Samsung’s weaker track record in HBM makes the shift to a more advanced node a sign of a stronger push to catch up.

Samsung said in July that it had provided samples of its HBM4 chips to customers, with a plan to supply them next year.

An SK Hynix executive told Reuters in an interview last month that because of technological changes in how SK Hynix and rivals such as Micron and Samsung build next-generation HBM4, their products include a customer-specific logic die, or "base die", that helps manage the memory.

That means it is no longer possible to easily replace a rival's memory product with a nearly identical chip or product.

Shares of SK Hynix so far this year are up 88.9%, outpacing the KOSPI's 41.5% gain, while Samsung Electronics shares have risen 41.7%. Micron shares trading on Nasdaq have climbed 78.9% over the period.

($1 = 1,387.7600 won)