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SK Hynix in Talks With Intel to Manufacture Memory Chips
SK Hynix is in discussions with Intel about a deal that would put the South Korean chipmaker’s memory production on American soil for the first time in its history, according to Reuters, which cited three people familiar with the matter. The talks, described by those sources as still exploratory with no final decisions made, center on Intel’s long-delayed semiconductor campus in New Albany, Ohio, a site that has become something of a symbol of Intel’s broader struggles to execute on its own domestic manufacturing ambitions.
Two possible structures for a deal have emerged from the discussions so far. One option would have SK Hynix simply lease a portion of Intel’s Ohio facility to run its own memory production line independently. The other, more complex path would involve SK Hynix forming a joint venture alongside Intel and major cloud computing companies that are eager to lock in more reliable, geographically diversified memory chip supply, a detail that reflects just how tight global memory markets have become as AI infrastructure spending accelerates. Reuters wasn’t able to determine which specific memory products SK Hynix might end up producing at the site if an agreement is finalized. The company’s current portfolio spans DRAM chips used across servers, PCs and smartphones, NAND flash for long-term storage, and high-bandwidth memory, or HBM, the specialized chip type SK Hynix currently leads the market in supplying for AI processors, a segment that’s become one of the most sought-after and supply-constrained products in the entire semiconductor industry.
The Ohio campus itself has a complicated backstory that makes this potential deal notable beyond just the SK Hynix angle. Intel broke ground on the site in 2022, describing it at the time as its first entirely new manufacturing facility in roughly 40 years and pledging more than $28 billion toward building two leading-edge chip factories there. The campus spans approximately 1,000 acres, large enough by Intel’s own account to eventually house up to eight semiconductor fabrication plants. But construction has dragged well behind Intel’s original timeline, a symptom of the broader financial and operational struggles that have plagued Intel’s foundry business in recent years as it’s tried and largely failed to keep pace with rivals like TSMC and Samsung in advanced chip manufacturing. A separate Korean media report back in July had already suggested SK Hynix was exploring an outright purchase of the Ohio campus rather than simply leasing space within it, indicating this potential arrangement has been under discussion in various forms for some time before Wednesday’s report offered the clearest picture yet of how it might actually get structured.
For Intel, a deal along these lines would function as something close to a lifeline, handing off underutilized capacity at a site that’s cost the company enormous sums with limited return so far, while still keeping the facility active and generating some form of revenue or partnership value. For the Trump administration, which has spent much of the past year pressuring chipmakers to shift manufacturing onto American soil, an agreement would represent a genuine policy win, arriving at a moment when relentless investment in AI and data center buildouts has created what industry insiders describe as an acute global shortage of memory chips. Getting one of the world’s largest memory producers to manufacture domestically for the first time would be exactly the kind of concrete outcome the administration has been pushing semiconductor companies toward.
The path to an actual deal isn’t without real friction, though, and much of it runs through Seoul rather than Washington. South Korea’s government has historically treated advanced memory manufacturing technology, particularly HBM and cutting-edge DRAM, as sensitive national assets, and any agreement involving what regulators classify as a national core technology would trigger a mandatory review process under the country’s Industrial Technology Protection Act. South Korea’s trade ministry, responding to questions about the reported talks, said any decision on manufacturing chips in the US would ultimately be SK Hynix’s own call, but confirmed that a review would be required if the technology involved met that national core designation. That regulatory hurdle, combined with the simple fact that manufacturing semiconductors in the United States costs considerably more than doing so in South Korea according to two of Reuters’ sources, means Seoul’s government could end up being just as significant a factor in whether this deal happens as anything decided between SK Hynix and Intel directly.
Markets reacted modestly but positively to the news. SK Hynix shares climbed 2.7 percent to 1,735,000 won following the report, outpacing the broader KOSPI index’s roughly 1 percent gain for the day. Intel, for its part, declined to comment directly on what it characterized as speculation, though the company reiterated that it remains committed to continuing investment in preparing the Ohio site, without confirming or denying any specific talks with SK Hynix. The US Commerce Department did not respond to a request for comment on the matter.
It’s also worth noting SK Hynix isn’t approaching the US market for the first time here regardless of how these Ohio talks resolve. The company is already in the process of building a semiconductor packaging facility in Indiana, a project separate from the Ohio discussions but part of the same broader trend of major memory and chip companies expanding their American manufacturing footprint under sustained pressure from Washington. Whether the Ohio talks eventually produce a formal agreement, and if so, whether it takes the shape of a straightforward lease or a more elaborate joint venture with cloud computing partners, remains genuinely unresolved. But the fact that SK Hynix, one of the two dominant forces in global memory production alongside Samsung, is seriously discussing US-based manufacturing at all marks a meaningful shift in a company that has kept its most advanced memory production almost entirely within South Korea throughout its history.
