“The market expects SK hynix’s operating profit this year to exceed US$100 billion (approximately KRW 144.85 trillion). It sounds like good news, but it could also become a US$100 billion loss.”

SK Group Chairman Chey Tae-won made these remarks on the 20th (local time) at the ‘Trans-Pacific Dialogue (TPD)’ hosted by the Chey Institute for Advanced Studies in Washington, D.C., saying that “the artificial intelligence (AI) transition period is extremely volatile.” He added, “Things are changing from moment to moment, to the extent that three-year or five-year plans, let alone even one-year plans, are practically meaningless,” and said, “New technology can be a solution, but it can also wipe everything out.” This is interpreted as meaning that it is difficult to predict the trajectory of advances in new technologies such as AI.

The semiconductor market is also undergoing rapid change. Chey said, “There is a serious supply shortage of AI memory, and the shortfall this year alone will exceed 30% relative to demand,” and added, “We need to manufacture more ‘monster chips’ such as high bandwidth memory (HBM), which is our most advanced technology.” He further stated, “This shortage is creating a completely different story,” pointing out that “AI infrastructure is sucking up all the memory chips, making it more profitable to sell standard chips in non-AI sectors. It is a distortion.” In fact, according to the industry, the current profit margins for HBM and general memory chips are around 60% and 80%, respectively.

He also stressed the urgency of resolving energy issues in the AI era. Chey said, “AI is devouring all the energy and electricity we need,” and warned, “If we fail to properly meet power demand, the result will be a disaster.” He continued, “Another issue is probably finance, namely the cost of AI infrastructure,” noting that “it takes US$50 billion to build a single data center.”

Chey said, “What is clear is that no one can stop the AI race,” adding, “Those who have capital and resources will become the frontrunners in AI competition.”

The TPD, hosted by the Chey Institute for Advanced Studies, is a platform where current and former high-ranking officials from Korea, the United States and Japan, leading global scholars, think tanks, and business leaders gather to discuss international issues. Launched in 2021, it marks its fifth edition this year.

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