[SK hynix’s 40th Anniversary] CEO Kwak Noh-Jung Says Company to Become Specialty Semiconductor Memory Provider for the AI Era

• As the nature of business changes in the age of AI, SK hynix President and CEO Kwak Noh-Jung says the era of customized specialty memory which meets diversifying customer needs is coming
• Kwak says the “triangle” of the Icheon, Cheongju, and Yongin facilities will become a semiconductor mecca, and the company will focus on social contributions as well as business growth
• Employees express pride for company due to the horizontal corporate culture and worker autonomy during a special interview to commemorate the company’s 40th anniversary

▲ SK hynix President and CEO Kwak Noh-Jung speaks with employees on the company’s 40th anniversary (From left, Son Aeri, Kwak, Lim Seohyun, and Ma Kyoungsoo)

 

To commemorate SK hynix’s 40th anniversary on October 10, SK hynix President and CEO Kwak Noh-Jung laid out the company’s vision. “We will transform semiconductor memory, which has generally been considered as a commodity product¹, into customized specialty solutions through continued innovations,” he said. During a special interview, Kwak claimed that “only companies that satisfy customers by breaking away from old methods centered on commodity products will survive.”

The AI era has already brought about swift increases in the capabilities of AI systems and a diversification in the memory specifications required by major tech companies. In this rapidly changing environment, SK hynix is leading the AI memory sector with its innovations, including the world’s first mass production of HBM3² and development of the world’s best-performing HBM3E.

¹Commodity product: In the semiconductor field, commodity products are simple mass-produced chips used for performing repetitive processing routines.

²High Bandwidth Memory (HBM): A high-value, high-performance memory that vertically interconnects multiple DRAM chips, enabling a dramatic increase in data processing speed in comparison to earlier DRAM products. HBM3E is the extended version of the HBM3 and the 5^th generation of its kind.

▲ Kwak talks about the company’s vision with employees

 

Traditionally, the memory industry has used a low-mix high-volume manufacturing³ system where both DRAM and NAND solutions were developed and quickly produced in large quantities. Although customized technology has been developed in some areas as the memory sector has advanced over recent years, the industry is still largely centered on commodity products.

³Low-Mix High-Volume (LMHV) manufacturing: A production model that enables businesses to produce large volumes of a small number of products.

However, as the pace of technological advancement in AI accelerates with the emergence of generative AI services such as ChatGPT, the industry consensus is that the types of AI services and related training will differ for each company. This will result in distinct memory specifications for companies across the world.

Following the mass production of HBM3E in 2024, Kwak claims that memory specifications will need to be configured in close collaboration with customers in the AI business from the earliest stages. This will entail major industry-wide changes in design and production methods, as well as marketing.

“Going forward, we need to first understand the specialty of each of our customers’ work and then customize the memory to meet their needs,” he said. “That represents a big growth opportunity for us.”

▲ Kwak talks about the opportunities the future holds for SK hynix

 

For the talk, Kwak was joined by three SK hynix employees who represented different generations. Ma Kyoungsoo, a senior engineer of the Manufacturing and Technology department who has been with the company for more than 30 years and was honored as SK hynix’s first Master⁴ in 2023; Technical Leader Son Aeri of the DRAM Development department who was born in October 1983 when the company was founded; and Technical Leader Lim Seohyun of the NAND Development department who joined the company in 2023, sat down with Kwak to talk about SK hynix’s past, present, and future.

⁴Master: An in-house guru at SK hynix who takes on the role of an advisor, passing on knowledge of the semiconductor manufacturing site to juniors and suggesting solutions to various problems.

▲ Kwak talks to employees about the company’s facilities in Icheon, Cheongju and Yongin

 

When asked about the company’s future, Kwak first spoke of the potential of facilities in Icheon, Cheongju, and Yongin. Once the first fab in SK hynix’s Yongin cluster becomes operational in 2027, it will join the company’s existing Icheon and Cheongju sites to form a triangle on the map and create an optimized production system which will increase business efficiency.

“When the triangle is completed, SK hynix will become a global semiconductor mecca spread across the three cities,” Kwak said.

Regarding the future of semiconductors, Kwak predicts that there will be a technological convergence between memory, CPUs, and system semiconductors as their boundaries become blurred, and that the applications of memory will broaden. “As products such as PIM⁵, which puts computational functions in the memory itself, become more sophisticated, they are likely to be applied to quantum computing⁶ technology,” he said. “Our ability to lead this shift will be a decisive factor in determining our future.”

Kwak also emphasized that “in the future, we need to pay attention to our surroundings, not just technology or products, and strive to make the world a better place. We need to continue to work toward our environmental goals, such as achieving net zero and RE100⁷, while also thinking about how we can contribute to society and improve our governance system,” Kwak said, adding that he plans to strengthen the company’s ESG management.

⁵Processing-In-Memory (PIM): A next-generation technology that adds computational capabilities to semiconductor memories to solve the problem of data movement congestion in AI and big data processing.

⁶Quantum computing: A computational method that utilizes quantum mechanical phenomena such as entanglement and superposition to solve complex problems faster than traditional computers.

⁷Renewable Electricity 100 (RE100): A global initiative for businesses to procure 100% of electricity via renewable electricity.

▲ Ma talks about how the company has changed over the past 40 years

 

Kwak also spoke with staff about the company’s evolution over its 40-year history. Ma, who has worked at SK hynix since the early 1990s, cites horizontal corporate culture following the elimination of the hierarchical system as the biggest change. “It has created a work environment with strong communication and flowing ideas,” he said.

“Safety awareness has also increased as much as technical skills. The safety rules have become as detailed as the actual work we do, which has created an environment where everyone can work with peace of mind,” Ma added.

▲ Lim talks about Gen Z’s positive impression of SK hynix

 

“The company guarantees a wide range of autonomy to its employees, including a flexible work system, making it a place where Gen Z wants to work,” said Lim, who joined the company in 2023.

Kwak responded by praising staff for their ability to work autonomously and use their initiative in the face of adversity. Recalling the early 2000s, he said: “When the company experienced challenges, employees put in great effort and approached their work with a sense of ownership. Looking back, this sense of ownership is in line with our VWBE⁸ philosophy.”

⁸Voluntarily and Willing Brain Engagement (VWBE): One of the employee values emphasized by SK Management System, or SKMS.

▲Son reflects on turning 40 as SK hynix celebrates its 40^th anniversary

 

“I turn 40 in the same month the company celebrates its 40^th anniversary,” said Son. “When I was younger, I thought that 40 was the age of a mature adult, but now I realize that it’s the age of a young person who needs to develop and grow constantly, both myself and the company. I think we’ve entered the new starting point for further development.”

Kwak also acknowledged the need for the company to continue to grow and progress. “Recent reports show that the average lifespan of a global company is only 15 years, and it’s going to get shorter,” he said. “We can be proud of our 40-year history, but we also have more work to do.”

▲ Kwak thanks the employees for all their hard work

 

Wrapping up the talk, Kwak thanked all of SK hynix’s employees for making the company’s 40-year history possible. “Our recent industry-leading technologies, including HBM3E, DDR5, LPDDR5, and 321-Layer NAND, are the result of the hard work of our employees, and I would like to take this opportunity to thank them,” he said.

“The current generation is very rational in the way they work, and they are ready to work at 150% of their capabilities, or even more,” he said of the junior members who are becoming the company’s core workers, adding that he is excited about the next 40 years.

Kwak concluded by saying that “we have all excelled as one team, one company, and our goal is to become a global market leader.”