SK hynix has responded to rumors that the company is exiting the consumer business, stating that the Korean giant has no such plans for now.
SK hynix Will Still Satisfy Consumer Demand Through OEM Channels, But Balancing It With AI Supply Is Becoming Difficult
The ongoing memory shortages have disrupted the consumer/AI supply chains to the point where suppliers, such as SK hynix and Micron, are forced to make aggressive decisions to fulfill market demand. One of the major shocks to the consumer industry was Micron's exit from the Crucial business, which prompted rumors that competitors like SK hynix would follow suit. We reached out to SK hynix to inquire about the company's stance on whether it will continue its consumer business, and they rejected such rumors, stating that the business remains intact.
SK hynix is not considering discontinuing its consumer business.
- SK hynix spokesperson
While the statement is concise, it does put an end to existing rumors about supply chain uncertainity, as the OEM business for companies like Micron and SK hynix still accounts for a fair share of the company's DRAM revenue. While the demand from the AI industry has grown aggressively, manufacturers like AMD and Intel, along with their respective AIB vendors, are still experiencing strong demand for DRAM products, as the consumer channel isn't expected to slow down for now.
In our talk with Micron, it was evident that memory suppliers find it more worthwhile to cater to the demand coming from the AI segment, given the rapidly increasing TAM figures, along with how products like HBM bring in a much higher profitability percentage, relatively to general-purpose DRAM products. However, memory suppliers still aren't looking to give up on their consumer businesses, but maintaining the balance alongside AI has become difficult for them, given the supply shocks they are seeing.
It would be interesting to see how the memory situation evolves moving forward, especially considering that DRAM demand from AI customers isn't expected to slow down anytime soon.
About the author: Muhammad Zuhair is a hardware and technology reporter for Wccftech, specializing in the semiconductor industry and the complex interplay between technology, manufacturing, and geopolitics. His coverage focuses on the corporate strategies and technological roadmaps of industry giants like TSMC, NVIDIA, Samsung, and Intel. Zuhair's expertise lies in deconstructing complex topics such as fabrication nodes (e.g., 2nm process), the economic impact of policies like the CHIPS Act, and the strategic development of AI infrastructure from NVIDIA, AMD and Intel.
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