SK Hynix debut is a bet that AI breaks boom-and-bust chip cycle

SK Hynix completed the largest U.S. listing by a foreign company, raising $26.5 billion, as shares surged 13% on debut. The company is betting that AI-driven demand for memory chips has permanently broken the industry's historic boom-and-bust cycle, with CEO Kwak Noh-Jung citing persistent supply shortages from the ChatGPT era.

South Korean memory chipmaker SK Hynix just pulled off the largest public listing by a foreign company in U.S. market history. Shares soared 13% on their first day of trading. Behind this historic debut is a simple bet: that the artificial intelligence boom has fundamentally reshaped the decadeslong boom-and-bust cycle that’s defined the memory-chip business for good. SK Hynix raised $26.5 billion with its American depositary receipt offering, and much of that is going toward expanding chip manufacturing — a move the entire industry had for years resisted after being burned by past supply gluts. “We’ve always been a cyclical industry, so there had been prior ups and downs,” SK Hynix CEO Kwak Noh-Jung said. But “things have clearly changed.” The ChatGPT era has brought about memory supply shortages so persistent that they’re rippling across supply chains and raising the prices of everything from iPads to Xbox consoles.