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IPO Plans and Chip Crunch
South Korean chipmaker SK Hynix plans a U.S. IPO to raise $29 billion by listing its shares on the Nasdaq exchange, with an initial offering plan to issue 17.79 million new shares valued at $29.65 billion U.S.
“A shortage of memory chips is affecting consumer electronics, and the situation risks worsening”
SK Hynix said it expects to start trading on Nasdaq on July 10, and the date is tentative, as the company’s stock 000660 has gained 281% this year amid an artificial intelligence frenzy.
The company is also building a $4 billion U.S. packaging plant in the U.S. State of Indiana and a new campus of memory chip fabrication plants in South Korea scheduled to come online in 2027.
The memory shortage is tied to high-performance computing needing large amounts of general-purpose DRAM for high bandwidth memory, and SK Hynix holds 60% of the high bandwidth memory chip market, according to Counterpoint Research.
In parallel, the shift toward enterprise memory chips for AI servers is squeezing supply for consumer electronics, as the AI data center boom prompts manufacturers such as Samsung Electronics, SK Hynix, and Micron Technology to retool production lines.
Prices Jump, Tim Cook Warns
Consumer electronics prices have surged as the memory chip shortage ripples through product lines, including a new Surface Pro starting at US$1,599 up 60% and a Surface Laptop priced from $1,499, 50% higher.
Gaming hardware has also moved, with Nintendo Switch 2 bundled with the game Legends of Zelda priced at $499, 11% higher than in May, and Sony’s PS5 Pro rising 20% to $900 in two months.
Apple CEO Tim Cook told The Wall Street Journal last week, "Unfortunately, price increases are unavoidable," adding, "We’re doing our best to mitigate the huge increases that are being passed to us."
The same source links the pressure to DRAM and NAND flash shortages and says AI demand for memory and storage chips has driven costs so high that Apple may need to raise device prices significantly to preserve profit margins.
TechInsights estimates that passing higher costs on to consumers while maintaining current margins would add about $270 to the price of the next iPhone Pro model, while the iPhone 17 Pro currently starts at $1,099 with a gross margin of 47%.
U.S. Tariffs Threaten Supply
The U.S. government has raised the stakes for memory makers by threatening 100% tariffs on foreign producers exporting RAM memory components, with SK Hynix and Samsung named as key targets in the coverage.
“As if the current RAM memory shortage weren't enough, manufacturers such as SK Hynix and Samsung face a new reason for concern: the possibility that the U”
At a ceremony marking the start of construction of a new Micron factory in New York, U.S. Secretary of Commerce Howard Lutnick warned: “Anyone who wants to build memory cards has two options: you can pay a 100% tariff or you can build in the United States,” he said.
TechRadar frames the same warning as Lutnick telling manufacturers, "Anyone who wants to build memory has two options: they can pay a 100% tariff, or they can build in the United States. That is the industrial policy."
The tariff threat is described as coming on top of already steep price increases tied to the RAM crisis, and the coverage says the U.S. intends SK Hynix and Samsung to manufacture chips in the United States rather than only package chips made in Asia.
The stakes extend to consumers and device makers, as the memory price increase crisis is portrayed as likely to worsen if the threatened measure is implemented, with the coverage pointing to price problems for consumers of laptops and PCs.
