Memory chips could be the next bottleneck for AI
Live MintInvestors are accustomed to volatility in the semiconductor industry. On October 24th SK Hynix, which has surged ahead in the fast-growing segment of high-bandwidth memory chips, which are needed for AI, reported a record profit. More than nine-tenths of the time it takes an AI model to respond to a user query is spent shuttling data back and forth between logic and memory chips, according to SK Hynix. View Full Image The chips are also highly profitable, with operating margins more than five times those of standard memory chips.SK Hynix, whose share price has more than doubled over the past two years, controls over 60% of the market, and more than 90% for HBM3, the most advanced version. Meanwhile Samsung, which manufactures 35% of the world’s HBM chips, has been plagued by production issues and reportedly plans to cut its output of the chips next year by a tenth.
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