SK Hynix in Talks With Intel for US Memory Chip Production, Reuters Reports

SK Hynix Inc. is in exploratory talks with Intel Corp. about a potential partnership to manufacture memory chips in the United States for the first time, according to a Reuters report citing three people familiar with the matter. The discussions represent a significant potential expansion of SK Hynix's U.S. footprint amid growing pressure to onshore semiconductor production.

Potential Deal Structures

The discussions, which remain in early stages with no final decision made, reportedly include two main options. One possibility involves SK Hynix leasing a portion of Intel’s planned chipmaking facility in Ohio. Another option being considered is a joint venture that could also include major cloud providers seeking to secure a stable supply of memory chips, Reuters said.

The companies have not yet determined which types of memory chips would be produced. SK Hynix is a major manufacturer of DRAM and NAND flash memory and is a leading supplier of high-bandwidth memory (HBM), a critical component for artificial intelligence processors.

Strategic Rationale and Market Impact

A deal could be mutually beneficial. For SK Hynix, it would address pressure from U.S. customers and Washington to establish a domestic manufacturing presence, particularly as demand for AI-related components soars. For Intel, a partnership could help alleviate the financial burden of its delayed Ohio site, where production is not expected to begin until 2030 and 2031.

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Following the report, shares of SK Hynix (KS:000660) rose 2.7% in Seoul, outperforming the broader KOSPI index, which gained 1%. SK Hynix and Intel did not immediately respond to requests for comment, according to the report.

Geopolitical Context and Hurdles

The talks are set against a backdrop of U.S. efforts to boost domestic semiconductor manufacturing and secure supply chains. While U.S. production costs are significantly higher than in South Korea, the strategic imperative to build locally is growing.

However, any plan to produce advanced memory like HBM or DRAM in the U.S. could face scrutiny from the South Korean government. According to the sources cited by Reuters, such technologies are considered sensitive, and a project could be subject to review under the country's Industrial Technology Protection Act. South Korea's trade ministry stated that any decision would be up to SK Hynix but confirmed that projects involving nationally important technology may require review.