From Zombie Firm to AI Titan: SK Hynix's Remarkable Rise
For years, landing a position at Samsung Electronics Co. was the ultimate career goal for ambitious young Koreans. However, a recent survey reveals a dramatic shift: SK Hynix has now emerged as the most sought-after employer among jobseekers in South Korea. Lim Hee-jin, a student at Seoul National University, encapsulates this sentiment, stating, "SK Hynix is a really good company with high future potential. If a friend got hired there, I'd say 'You got into a great place—I envy you.'"
Dominating the AI Chip Market
The chipmaker is experiencing its most successful period ever, thanks to its dominance in one of the global economy's most critical technologies: high-bandwidth memory chips, which are essential for powering artificial intelligence development. SK Hynix has outmuscled better-known rivals, including Samsung, to capture more than half of the global market for HBM chips. These components enable the high-speed flow of massive data volumes required for AI applications.
As the primary HBM supplier to Nvidia Corp. and recently selected by Microsoft Corp. for its proprietary AI chips, SK Hynix is at the forefront of the AI revolution. Shortages of HBM, along with less powerful Dram and NAND memory, are driving prices higher, with SK Hynix reaping substantial benefits. In the fourth quarter, the company's revenues surged 66% year-over-year, while operating margins hit an impressive 58%, outperforming even TSMC, the world's largest chipmaker. Over the past 12 months, SK Hynix's market capitalization has skyrocketed 340% to Won640tn (US$438 billion).
A Strategic Transformation
Professor Kwon Seok-joon of Sunkyunkwan University in Seoul notes that SK Hynix has evolved from "a follower" to "a shaper" of the semiconductor sector. "SK Hynix has made the memory constraint its advantage," he explains. The company is now doubling down on AI, moving beyond chip manufacturing by committing US$10 billion to establish an "AI solutions firm." Group chair Chey Tae-won has declared AI as a "fourth quantum leap" for SK Group, the sprawling chaebol to which SK Hynix belongs.
Overcoming a Troubled Past
SK Hynix's current success would have seemed unimaginable throughout much of its history. Founded under Hyundai's auspices in 1983, the company became a creditor-owned "zombie" firm after the 1997-98 Asian financial crisis and an early 2000s Dram glut. Suitors like Micron came and went, with a US$3.2 billion offer in 2002 rejected due to unresolved debts. It wasn't until 2011 that SK Group intervened, paying Won3.4 trillion to end what was known as "the Curse of Hynix."
Today, SK Hynix stands as the crown jewel of SK Group, a former textile maker that grew through strategic acquisitions, including Korea Oil Corporation and SK Telecom. This transformation underscores a remarkable journey from obscurity to industry leadership, positioning SK Hynix as a vital ally in the global AI landscape.
