SK Hynix Effectively Rebuffs US Big Tech's Offers of Tens of Billions of Dollars in Investment Support

US big tech companies—Google parent Alphabet, Microsoft (MS), and Meta among them—are pouring out offers to help fund the construction of fabs (chip plants) worth tens of trillions of won and to cover the cost of purchasing extreme ultraviolet (EUV) lithography equipment. But SK Hynix is politely declining these offers while simultaneously using them as leverage in long-term supply agreements. The reasoning: with investment funds already overflowing, there is no reason to disturb the "super supplier" (super-eul) status it currently enjoys.

According to industry sources on the 27th, SK Hynix recently received memory-chip capital-investment support offers from Alphabet, MS, and Meta, but management is reportedly not treating them as realistic, actionable options. The biggest sticking point is that building a fab with funding from a specific big tech company would create a contract structure carrying exclusive supply obligations.

A semiconductor industry official said, "If you build a production line with a particular customer's money, you create the risk that even if that customer's demand falls in a future downturn, you'd have to prioritize their volume or supply below market price," adding, "Internally, SK Hynix views the side effects that could arise from taking big tech investment negatively and is wary of them."

SK Hynix currently holds what is effectively a duopoly alongside Samsung Electronics in the high-bandwidth memory (HBM) market. It supplies most of the HBM mounted on Nvidia graphics processing units (GPUs), and this year's output is already sold out. Because there are virtually no producers other than SK Hynix and Samsung capable of properly mass-producing the high-spec HBM used in AI data centers, a reversal has taken shape in which the big tech customers have instead become the subordinate party (eul) before SK Hynix.

The big tech proposals take two main forms. The first is to directly shoulder part of the cost of building the first fab (Y1) in the semiconductor cluster SK Hynix is developing in Yongin, Gyeonggi Province. SK Hynix plans to invest a total of 31 trillion won in the first fab alone; once completed, it will add 350,000 wafers per month of production, expanding total capacity to around 900,000 wafers per month.

Also under discussion was a plan to subsidize the cost of purchasing EUV lithography equipment from the Netherlands' ASML. ASML's latest High-NA EUV machine is an ultra-premium tool costing roughly $400 million (about 550 billion won) per unit—about twice as expensive as the current-generation EUV. To secure this equipment, which is essential for mass-producing advanced memory at the 1c DRAM node and beyond, SK Hynix has already finalized a plan to bring in some 12 trillion won worth of EUV tools. The move is read as big tech's intent to effectively pre-secure dedicated production lines by sharing part of this cost.

Behind the unusual nature of these proposals lies the extreme intensification of the AI infrastructure investment race. Alphabet, Meta, and MS each disclosed AI infrastructure investment plans worth tens of billions of dollars in their recent earnings reports. MS in particular said its capital expenditure this year would reach $190 billion, explaining that the increase in component costs such as chips alone amounts to $25 billion. Meta likewise acknowledged its supply-chain pre-emption strategy, saying it is signing contracts across the supply chain to secure necessary components in advance.

SK Hynix is refusing structural dependence—such as fab equity investment or joint equipment ownership—while opting instead to use big tech's desperation as negotiating leverage. A source familiar with SK Hynix said, "Various ideas are being discussed to strengthen the binding force of contracts as we sign long-term agreements (LTAs) with global big tech." The industry interprets this as higher prepayments, ultra-long contracts of five years or more, and price-floor guarantee clauses. The strategy is to convert the funds big tech brings not into factory equity, but into more favorable contract terms.

SK Hynix's confidence is backed by the numbers. Its operating margin as of the first quarter this year reached 72%, and in February it announced an additional $15 billion (about 21 trillion won) investment plan to expand next-generation memory production. Construction of the first fab at the Yongin cluster is under way, targeting its first cleanroom operation in February next year—three months ahead of the original schedule.

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