SK Hynix is reportedly in discussions with Intel regarding a potential deal to manufacture memory chips on US soil for the first time. According to sources familiar with the matter cited by Reuters, this collaboration could involve SK Hynix leasing space in Intel's planned fabrication plant in Ohio or forming a joint venture with the chipmaker.
This potential partnership could also extend to include hyperscale cloud firms, a detail that some analysts believe is more significant than the direct SK Hynix-Intel agreement itself. A joint venture would offer shared risk and infrastructure, potentially benefiting both companies.
Previous reports indicated that SK Hynix was considering using Intel Foundry Services to produce its base dies. While these latest discussions are still considered rumors, they lend further credence to the possibility of deeper manufacturing cooperation. SK Hynix currently has US-based operations, but these are limited to chip packaging, with its wafer fabrication production remaining in Asia. The company recently broke ground on a new packaging facility in Indiana.
For Intel, such a deal could provide much-needed relief. The company has faced significant challenges in recent years, even resulting in a 10% stake being transferred to the US government. However, Intel has been highlighting a recent turnaround, evidenced in its latest earnings reports. The news of the potential SK Hynix deal has led to a modest increase in Intel's share price, with SK Hynix also seeing a similar, small spike.
While the prospect of manufacturing in the US aligns with governmental initiatives to boost domestic chip production and potentially avoid tariffs, it may face scrutiny from Seoul, SK Hynix's home country. However, leveraging Intel's existing or planned facilities could mitigate the need for SK Hynix to undertake massive capital investment for new standalone production sites, possibly easing concerns about relocating too much production away from South Korea.