South Korea is investing $520 billion in Samsung and SK Hynix to build more HBM fabs for AI

South Korean President Lee Jae Myung has announced a $520 billion USD public and private investment for Samsung and SK Hynix to build more HBM fabs.

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Kosta Andreadis

Senior Editor

Published Jun 30, 2026 1:31 AM CDT

1 minute & 15 seconds read time

TL;DR: South Korea is investing $520 billion in Samsung and SK Hynix to build four new fabs focused on high-bandwidth memory (HBM) for AI and data centers. This public-private funding aims to accelerate construction, enabling the fabs to operate by the mid-2030s and strengthen South Korea's leadership in the memory market.

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As home to two of the world's largest memory makers, Samsung and SK Hynix, the South Korean economy is definitely benefiting from the current memory crisis, which has seen prices and profits hit unforeseen levels. Long story short, in the AI era of LLMs, agents, inference, and cloud-based computing, the demand for high-bandwidth memory (HBM) chips has reached a point where supply would take years to catch up.

South Korea is investing $520 billion in Samsung and SK Hynix to build more HBM fabs for AI 2

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And with that, South Korean President Lee Jae Myung has announced a $520 billion USD public and private investment to expand the chipmaking capabilities of Samsung and SK Hynix so the country can remain a leader in the AI race and the memory market. And the announcement was made in a televised address with Samsung Electronics Chairman Lee Jae-yong and SK Group Chairman Chey Tae-won.

According to the announcement, the majority of the $520 billion will be put toward the construction of four new fabs, two for Samsung and two for SK Hynix. The two plants will reportedly be built outside Seoul, in a mostly rural area. They will focus on producing lucrative HBM for the AI and data center markets rather than memory for the consumer technology market.

Read more: South Korea announces $518 billion semiconductor investment with Samsung and SK hynix for new memory fabs

"We will focus our investment on HBM fabs," Samsung Chairman Lee Jae-yong confirms. The inclusion of the South Korean government means these new facilities can be constructed on a much faster timeline, with the expectation that approvals, subsidies, and permits will be available more quickly. And with that, the expedited timeline would have these new fabs go online in the mid-2030s rather than the 2040s.

Frequently Asked Questions

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Question 01

Will the new HBM fabs be compatible with existing packaging and interposer technologies used by current AI accelerator manufacturers?

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Question 02

How will prioritizing HBM for data centers affect the availability of consumer memory products from Samsung and SK Hynix in the near term?

Prioritizing HBM for data centers means the new fabs will focus on HBM production rather than memory for the consumer technology market, so consumer memory products from Samsung and SK Hynix are likely to be deprioritized in the near term. The article states the investment and new plants will concentrate on HBM for AI and data center markets, not consumer memory.

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Question 03