SK Hynix Strengthens NAND, Cultivates New Cash Cow

SK Hynix's Sales Proportion and Global SSD Market Share

[Asia Economy Reporter Dongwoo Lee] SK Hynix has strengthened its competitiveness in the NAND sector by acquiring Intel's NAND flash business.

According to industry sources on the 7th, if SK Hynix completes the acquisition of Intel's NAND business, its global NAND market share will exceed 20%, surpassing Kioxia to become the second largest. This means it will emerge as a global leader alongside Samsung Electronics in the NAND sector following DRAM.

Lee Seok-hee, CEO of SK Hynix, stated at the recent Q3 earnings conference, "Within the next three years, we will secure self-sustaining business capabilities in NAND, and within five years, SK Hynix's NAND sales will grow more than threefold compared to before the acquisition, establishing us as a top memory player."

This implies not only an increase in market share but also a significant enhancement in the competitiveness of NAND products. In particular, the industry expects a substantial improvement in the solution segment of high value-added NAND, such as solid-state drives (SSD) used in storage devices like PCs and servers.

Intel holds strong competitiveness in the data center-oriented eSSD market and possesses excellent firmware and controller technology, leading the industry in QLC (Quad-Level Cell) technology. QLC is an SSD that stores data in 4-bit units, allowing for greater capacity than conventional SSDs.

Global NAND demand is also expected to expand in the future. According to market research firm IDC, the SSD market within NAND is projected to grow at an average annual rate of 18% from 2019 to 2024, with enterprise SSDs expected to grow even faster at an average annual rate of 23.9%.

SK Hynix plans to pay $7 billion of the total $9 billion acquisition price in the first phase in the second half of 2021 to secure Intel's Dalian factory, SSD business intellectual property (IP), technology, and products.

CEO Lee emphasized, "With this acquisition of Intel's NAND division, we will quickly secure an SSD portfolio that will be a core growth driver in the future and overcome the scale limitations that were difficult to improve in the short term."

This content was produced with the assistance of AI translation services.