SK Hynix Weighs Solidigm Funding Options as HBM Reshapes DRAM Capacity

SK Hynix says no decision yet on Solidigm financing or new plants, as HBM is seen taking nearly 30% of DRAM wafer capacity next year.

SK Hynix has moved to damp speculation about the future of its U.S. subsidiary Solidigm, confirming that it is reviewing a range of financing alternatives for the business but has yet to settle on any course of action. The Korean chipmaker said on Thursday that no decision has been reached, and that any funding move would be judged on how it affects existing shareholders and the long-term value of the group as a whole.

The caution follows a Reuters report on September 25 that Solidigm is already contemplating a U.S. initial public offering as early as 2027. Such a listing could value the unit at up to $150 billion and raise as much as $15 billion. Solidigm had held preliminary talks with investment banks, though the plans were described as tentative, and SK Hynix stressed at the time that no concrete plans had been confirmed. Market chatter about a possible spin-off had earlier stirred worries about dilution.

Capacity Decisions Still Open

Questions over where SK Hynix builds are equally unresolved. In a regulatory filing with the U.S. Securities and Exchange Commission, the company said it is evaluating additional production sites, with no verdict yet on reports of a possible semiconductor plant in Japan. It pledged to disclose specifics if a decision is confirmed, or within three months.

Reuters reported on September 16 that SK Hynix was in talks with Intel over manufacturing memory chips in the United States, weighing options that included leasing part of an Intel facility in Ohio or forming a joint venture with Intel and cloud providers. SK Hynix made clear that no agreements on that front have been finalized.

HBM Tightens Its Grip on Wafer Supply

Running beneath these corporate maneuvers is a structural shift in memory production. A Samsung Electronics executive, speaking to Reuters on Tuesday, projected that high bandwidth memory will absorb close to 30 percent of DRAM makers' total wafer capacity next year, up from roughly 20 percent at present. Reuters counts SK Hynix among the leading suppliers of these specialized components.

That reallocation is pulling wafer resources toward more technically demanding architectures, a redistribution that chipmakers must now factor into their planning. To shore up its own technology base, SK Hynix is leaning harder on outside developers. Its SK hynix Ventures arm is targeting partnerships with young technology firms working on semiconductor research and manufacturing processes, while also focusing on building out artificial intelligence infrastructure. The unit was established roughly two weeks ago, and the stock has slipped 0.9 percent since then. Portfolio companies are to be wired into the group's internal development and manufacturing teams.

On the technology front, SK Hynix presented development plans for its next-generation memory portfolio at a TSMC conference in Santa Clara, California, on September 23, picking up a Partner of the Year award there for the second consecutive year.

Analyst Adjusts Target, Keeps Buy Call

DS Investment & Securities trimmed its price target for SK Hynix to KRW 2.64 million on Tuesday while retaining a buy rating. The brokerage pointed to a weaker U.S. dollar–Korean won exchange rate and the transition to the next generation of high bandwidth memory. Even so, it expects a recovery in the fourth quarter, underpinned by HBM4 growth and firming memory prices.

Investors are also bracing for the expiration of the company's supportive share buybacks around October 15 to 17, with market watchers anticipating that fresh shareholder-return programs could follow the upcoming quarterly results. Shares closed Friday in Seoul at KRW 1,841,000.00, up 0.4 percent on the day, extending their year-to-date gain to 183 percent. How SK Hynix squares the wind-down of buybacks with its investment ambitions will be the test of the coming weeks.