South Korean founder SK Hynix said Wednesday that it wants to increase spending on chip production equipment this year due to the current global semiconductor shortage. The company’s chief financial officer, Kevin Noh, presented on a conference call the founder’s plan to increase its investment spending on wafer-making equipment, or fab equipment, due to the shortage.
Given the lengthening of lead times and the period of equipment installation, SK Hynix will execute some of its planned spending for 2022 ahead of schedule, in the second half of this year, the CFO said. The subsequent increase in production capacity will take effect in 2022, added the finance manager of the South Korean smelter.
As a result of the equipment rush: Manufacturing equipment makers Applied Materials and Lam Research reported strong performance in their latest quarterly results due to strong demand for their equipment.
Demand is exploding
Earlier this month, the world’s largest contract chip maker, Taiwan Semiconductor Manufacturing Company (TSMC), said it expected the chip shortage to continue through 2022. AMD and Cisco also expect the shortage to continue throughout the year.
Last month, Samsung mobile boss DJ Koh said there was a serious imbalance between supply and demand for chips. However, Samsung’s chip division and its boss Kim Ki-nam have so far not commented publicly on how the shortage is affecting its business. The South Korean tech giant recently saw its chip factory in Austin, Texas, shut down for a month due to a power outage from winter storms.
In the meantime, SK Hynix said it has seen strong demand for its DRAMs from the mobile and PC industries, although the first quarter has traditionally been the off-season. SK Hynix said it expects this strong demand to continue.