SK hynix CEO Kwak Joh-jung speaks during the firm's regular shareholders' meeting at its headquaraters in Icheon, Gyeonggi Province, Wednesday. Courtesy of SK hynix

SK hynix displayed confidence in maintaining its leadership in high-bandwidth memory (HBM) chips against rivals — such as Samsung Electronics and Micron — as the market enters a path for stable recovery amid growing demand for artificial intelligence (AI) services here and abroad, the company said Wednesday.

"The memory chip market is on course for recovery this year, and AI has a huge effect over the improving market condition," SK hynix CEO Kwak Noh-jung said during the firm's regular shareholders' meeting. As the current AI services develop into the multimodal AI, demand for memory chips with more capacity will grow rapidly, according to him.

SK hynix is the leader in the global HBM market. HBMs are used for AI services, and its demand is forecast to surge for the next few years, as the AI gains growing traction in the global IT industry.

The chipmaker has started supplying its fifth-generation HBM — HBM3E — to Nvidia, the world's dominant AI chipmaker. The company is known to have entered the development phase on its next-generation HBM product.

"It took more than a decade for us to generate the current achievement," Kwak said. "We will keep maintaining our competitiveness to remain as the top market player, and keep close partnerships with industry-leading AI players and clients."

HBM3E chips produced by SK hynix / Courtesy of SK hynix

SK hynix is widely forecast to achieve a major earnings rebound this year, buoyed by the reviving memory chip demand here and abroad. According to its regulatory filing, the firm reported an operating loss of 770 billion won ($570 million) in 2023, hit hard by unfavorable market conditions and its subsequent impact on memory chip prices.

The company, however, attained an earnings rebound in the fourth quarter through cost reduction and preemptive actions to meet the growing demand for AI memory chips.

Kwak also shared the firm's plan to boost its overall profitability this year by developing portfolios for lucrative products such as solid-state drives and gaming chips.

"We will continue investment to strengthen our technological competitiveness, but at the same time, we will also focus on ensuring profitability in our NAND memory investment processes," he said.

The company also pledged to remain vigilant regarding escalating geopolitical uncertainties — particularly the upcoming U.S. presidential election.

"Depending on election results from each country, there stands a chance for the geopolitical circumstances to undergo a major change," he said. "We will raise our vigilance on the external environment and take preemptive actions."