US investors will soon get access to SK Hynix, another memory maker riding the AI boom

South Korean memory chip maker SK Hynix, a rival to Samsung and U.S.-based Micron, announced plans to sell nearly 17.8 million shares in a U.S. IPO. If the shares sell well, the company could raise around $28 billion, based on SK Hynix's closing share price last Friday in Seoul, according to Bloomberg. SK Hynix will offer American depositary receipts (ADRs), which allow U.S. investors to buy a foreign stock without trading directly on an overseas exchange. Each ADR will represent one-tenth of a common share. Pricing is expected on Thursday, with trading beginning Friday.

Like Micron, SK Hynix is riding an AI-fueled boom that has boosted both sales and stock price. First-quarter revenues were up nearly 200% year-over-year, and its stock has risen about 260% so far this year. This is because AI systems are very memory-intensive. As hyperscalers like Amazon, Microsoft, Google, and Oracle race to build AI factories and new data centers multiply, demand has outpaced supply, leading to a shortage of memory chips including High Bandwidth Memory (HBM), DRAM, and NAND. The situation has been called "RAMageddon." Apple executives said the shortage is forcing price increases on Macs and iPads.

South Korean tech companies, led by SK Hynix and Samsung, have vowed to spend over $550 billion on new manufacturing capacity. However, this is risky: by the time those facilities are built, AI memory needs may change, potentially leading to oversupply and crashing prices. For now, Wall Street is looking for another Nvidia, and memory chip makers are among the closest options. Micron, the closest U.S. comparison, has surged nearly 700% over the past year to a valuation of over $1 trillion, driven by record AI-driven memory demand and revenue.