Shares of SK hynix Inc. (KRX:000660) soared 10.9% on Friday, closing at 2,425,000 won, as South Korea's benchmark KOSPI index staged a sharp recovery from the previous session's steep losses. The memory chip giant's market capitalization swelled by approximately 169.6 trillion won in a single trading day, a figure that dwarfs the 100 trillion won investment planned for its Cheongju facility.
The rally followed a brutal 15% drop on Thursday, when the broader tech sector tumbled on renewed fears about oversupply in the artificial intelligence computing market. The KOSPI index surged 440.25 points, or 5.76%, to close at 8,088.34, recovering from Thursday's 7.89% plunge. The Korea Exchange briefly halted program trading for five minutes after a buy-side sidecar was triggered around 1:50 p.m. local time, according to Yonhap.
Market Cap Gain Exceeds Cheongju Investment
The one-day equity value increase of 169.6 trillion won is approximately 1.7 times the 100 trillion won SK hynix plans to allocate for its Cheongju projects, which include 80 trillion won for a NAND flash fabrication plant by 2029 and 20 trillion won for a chip packaging facility by late 2027. At Friday's close, the company's market capitalization stood at 1,728.30 trillion won, making the Cheongju investment equivalent to about 5.8% of its total market value.
Trading volume on Friday reached 7.95 million shares, roughly 1.42 times the average daily volume, reflecting heightened investor interest. Despite the strong rebound, SK hynix shares remain 18.8% below their 52-week high of 2,987,000 won. The intraday range was wide, spanning from 2,045,000 won to 2,454,000 won, a band of 409,000 won or 16.9% of the previous close.
AI Spending Fears and Market Sentiment
Thursday's selloff was triggered by a Reuters report that Meta Platforms Inc. (NASDAQ:META) is planning to sell computing power, fueling concerns that AI computing supply may outpace demand. IG analyst Fabien Yip characterized the move as "profit-taking" in a note cited by Business Insider. However, Friday's rebound suggests investors are reassessing the risks.
Analysts remain divided on the outlook. Zavier Wong at eToro noted that "a lot can happen to a technology cycle" before new capacity comes online, while Morningstar's Jing Jie Yu described the current memory upcycle as "substantially stronger than expected" but cautioned that the key question is how long the cycle will last before new supply arrives.
Broader Chip Rally and NAND Demand
The Korean market was lifted by gains across the semiconductor sector. Samsung Electronics Co Ltd (KRX:005930) rose 8.2%, while Japan's Kioxia Holdings Corp (TYO:285A) advanced 9.2%. Stephen Innes of SPI Asset Management told the Associated Press that Asian stock markets "found some footing" after a rough tech selloff, highlighting Korea's sharp turnaround in what had been a crowded trade.
SK hynix CEO Kwak Noh-jung said NAND demand is rising while supply remains tight, though the company noted it could adjust its long-term investment plans depending on chip demand and customer spending patterns. In Japan, Kioxia shipped samples of next-generation memory from its Kitakami plant, as AI inference drives demand for high-capacity NAND. Satoru Oyama, a former Tokyo Electron staffer now consulting, said chipmakers had sidelined NAND investment and "haven't been able to respond to the current NAND boom at all."
Implications for SK hynix's Cheongju Timeline
Kioxia CEO Hiroo Ota said the company plans to expand output at its Fab2 facility to meet demand, and analyst Kazuyoshi Saito of IwaiCosmo Securities believes Kioxia is two to four years ahead of competitors in NAND performance and power efficiency. This competitive pressure puts SK hynix's M17 fab in Cheongju in a delicate position: too late if shortages persist, but too large if AI budgets contract before 2029.
For investors, the key takeaway is that the market is now weighing the duration of the AI memory cycle more heavily than the cost of new plant construction. Friday's rally suggests that, for now, the bulls have the upper hand, but the wide intraday range underscores the uncertainty that continues to grip the sector.
