SK Hynix seeks U.S. chip equipment exports to China tied to new factory - Reuters

South Korean chipmaker SK Hynix is requesting U.S. approval to export additional American-made chipmaking equipment to its China factory, as part of plans by its U.S. subsidiary Solidigm to construct a new NAND flash memory factory in the United States, according to Reuters. SK Hynix aims to utilize the unused section of its Dalian facility, referred to as Mod B, to boost NAND production amidst a global memory chip shortage that has led to significantly higher prices.

NAND flash memory, utilized in solid-state drives for data centers powering artificial intelligence and cloud computing, is the focus of this increase. SK Hynix's shares on the Seoul Stock Exchange declined around 11% on Thursday as part of a wider technology sell-off. Solidigm is seeking an export license for additional equipment to be installed in the Mod B space, which was completed in 2023 but had its equipment installation left incomplete due to a memory market downturn.

SK Hynix stated that installation of the equipment in Mod B is being carried out in close coordination with and under authorization from the U.S. government, and they are not aiming to expand the facility's capacity. This additional production in China would assist Solidigm in funding its proposed U.S. NAND factory, serving as a stepping stone towards boosting domestic production, according to a source cited by Reuters.

Solidigm is also considering an initial public offering as early as next year to assist with financing the planned investment, the report mentioned. The U.S. government has been encouraging foreign chipmakers to build more manufacturing capacity in the United States while simultaneously restricting exports of semiconductor equipment to China in an effort to limit Beijing's advancement of advanced chips for artificial intelligence and military applications.

The U.S. Commerce Department removed exemptions that previously enabled SK Hynix and Samsung Electronics to receive American chipmaking equipment at their Chinese facilities without separate licenses.