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SK Hynix's American Depositary Receipts (ADRs) made a successful Nasdaq debut, trading above their offering price on their first day. As the leading memory chipmaker that has been setting record earnings day after day, SK Hynix drew intense interest on Wall Street from the very first day of trading. In particular, SK Group Chairman Chey Tae-won, who visited the ADR listing site in person, drew attention by maintaining strategic ambiguity amid the Donald Trump administration's continued pressure to invest in the U.S., saying, "We are reviewing it, but we have never said we will definitely build a plant." His stance was that even if the company does invest in the U.S., it will not do so to align with President Trump's term or election schedule. Chey also repeatedly emphasized to domestic and foreign media his view that "the surge in memory chip demand in the artificial intelligence (AI) market does not appear to be a short-term phenomenon," actively rebutting the peak-cycle theory recently spreading on Wall Street. The New York stock market closed higher on the first day of SK Hynix's ADR listing, showing a favorable reaction.
SK Hynix at $168.5 on Nasdaq Debut Day..."Overcame Bankruptcy Risk 25 Years Ago, Strengthening Ties With U.S."
On the 10th (local time), SK Hynix's ADRs began trading on the Nasdaq at an opening price of $170. This was about 14% higher than the $149 ADR offering price that SK Hynix had confirmed the previous day. SK Hynix's ADRs then closed the session at $168.49, which, converted to the value of the Korean shares, corresponded to about 2.528 million won. As a result, this formed a price about 16% higher than the previous day's closing price of 2.18 million won for the Korean shares on the KOSPI market.
Ahead of the start of trading that morning, SK Hynix executives also attended the commemorative "opening bell" ceremony marking the ADR listing at the Nasdaq MarketSite in Manhattan, New York. Kwak Noh-jung, CEO of SK Hynix, said at the event, "Just 25 years ago, our company went through the toughest period since its founding as the semiconductor market faced a serious crisis, and we were even on the brink of bankruptcy." He emphasized, "We endured it, found a way, and finally overcame the crisis." Kwak added, "The United States, the center of AI, has customers who need innovation, partners who build ecosystems, and talent who lead industries, all in one place," and expressed hope that "this listing will further strengthen our ties with them." Kwak also added, "A door to new opportunities is opening for investors around the world," and said, "We came here not simply to chase opportunities, but to contribute."
Bob McCooey, Chairman of Nasdaq Asia-Pacific, said at the same event, "This listing is an important milestone for SK Hynix and a very meaningful moment for the entire Korean and Asian capital markets," adding, "SK Hynix now stands alongside the world's leading technology companies."
After the opening bell ceremony, Chairman Chey, CEO Kwak, Chey Jae-won—Chairman Chey's younger brother and Senior Vice Chairman of SK Group—and Koh Seung-beom, Chairman of the SK Hynix board, took a commemorative photo in front of the Nasdaq MarketSite. A video commemorating SK Hynix's listing was also shown on the electronic billboard outside the Nasdaq MarketSite in Times Square, Manhattan.
Through this initial public offering (IPO), SK Hynix raised $26.5 billion (about 40 trillion won). This surpasses the $25 billion raised by China's Alibaba in 2014, making it the largest-ever U.S. stock market listing by a foreign company. Including U.S. companies, it is the second-largest record after the $85.7 billion (about 130 trillion won) of SpaceX, which listed on the Nasdaq on the 12th of last month. Even across the entire global market, it ranks third, after the $29.4 billion raised by Saudi Arabia's state-owned oil company Aramco in its domestic IPO in 2019. As the price of common shares on the Korean stock market recently declined, the total amount raised came in somewhat lower than the $29 billion (about 45 trillion won) initially expected on Wall Street. SK Hynix's ADRs began temporary trading on the Nasdaq Global Select Market under the ticker "SKHYV" on the 10th and will switch to regular trading under "SKHY" from the 13th.
Chey Tae-won: "U.S. Stock Options Make It Easier to Attract Global Talent...No Sign of HBM Demand Falling"
Immediately after the listing ceremony, Chairman Chey also conducted an English-language interview with CNBC inside the Nasdaq MarketSite. Chey said of SK Hynix's ADR listing, "It has been a kind of dream ever since we acquired the company 15 years ago, and now it has come true," expressing hope that "we will be able to have many financial options as we move forward." As a concrete example, Chey cited stock options to attract global talent. Chey said, "Stock options based on Korean shares are not that attractive or an incentive (to overseas talent), but now (with the ADR listing) we can recruit U.S. and global talent much more easily," adding, "The addition of U.S. and global shareholders will provide momentum for building a new governance framework."
When asked whether SK Hynix has plans to build additional U.S. semiconductor fabs (production plants) beyond the packaging (back-end) plant it is currently building in Indiana with a $4 billion investment, Chey gave only a general answer that "our team is currently reviewing it." Chey said, "Building a memory chip plant is not easy," adding, "As long as the conditions—power, clean water, land, labor, and supply chain ecosystem—are met, there is no reason not to invest, so we are searching for the right location not only in the U.S. but around the world." In effect, he neither completely ruled out nor firmly confirmed the possibility of additional U.S. investment.
Regarding the semiconductor peak theory recently spreading on the New York stock market, Chey raised a strong rebuttal, detailing the surging AI demand. Chey said, "It might have been the case in the old memory chip market, but in the AI era, the demand structure will unfold a bit differently," noting, "In the past, memory chip demand depended on the number of people or hardware devices, but in the AI era, it is not bound by that and is growing exponentially." He continued, "Numerous customers and partners all consistently want more chips," adding, "Even after I announced that I would double our production capacity within five years, every customer says, 'That's not enough, we need more.'"
When asked whether it was right not to set an upper limit on memory chip contract periods, Chey countered, "Our first principle is simply to focus on sustainability for our customers; the contract period is a matter that depends on their requests." Chey said, "The real problem is the supply shortage," explaining, "Demand is increasing so enormously that every partner is doubling capacity this year and next," and, "While there is no sign at all of high-bandwidth memory (HBM) demand declining, we are even being asked for additional supply of general-purpose DRAM." Regarding the situation in which rival Samsung Electronics is rapidly catching up in the HBM field, Chey offered a response to the effect that the demand surge will render competition within the industry meaningless, saying, "Far more people than expected want to use AI, and to meet that demand you have to generate many tokens (the basic units of words or sentences)." Chey further said that, beyond memory chips, the company is preparing investments of tens of billions of dollars or more in other AI areas such as data centers, startups, and joint ventures (JVs), foreshadowing that "there will be a huge investment soon."
Chey also dismissed as a "misunderstanding" U.S. concerns over SK Hynix operating two plants in China. Chey asserted, "Only 30% of the output from those fabs is supplied to the local Chinese market, while more than 70% is exported outside, most of it to U.S. customers," adding, "We are fully complying with U.S. policy, the so-called 'export controls.'"
"Elections and Terms Are Not Considerations, U.S. Customers Matter...Fabs Possible Anywhere With Power, Water, Land"
Chey then explained the meaning of SK Hynix's ADR listing in even greater depth at a subsequent briefing with Korean media correspondents at the Nasdaq MarketSite. Regarding the U.S. demand for investment, Chey again kept his distance, saying, "We can review it, but our position is not that we will definitely do it." Chey said, "The U.S. has not directly asked us to invest, but since there have been many related reports, whether there is an official request does not seem to matter." [BODY]
He said, "The reshoring policy of returning overseas operations to the home country that the U.S. administration is pursuing will naturally apply to semiconductors as well." He then emphasized once again, "To build a memory chip fab, various requirements must be met, such as power, clean water and a large site. If there is a location that meets those conditions, it doesn't matter whether it's the U.S. or anywhere else in the world." Consistent with his remarks in the CNBC interview, his position was that while more supply facilities do indeed need to be built, that location may or may not be the U.S.
Regarding the U.S. administration's demands that SK hynix and Samsung Electronics also invest in the U.S. whenever Micron holds an expansion event, Chairman Choi drew a line, saying, "From a businessperson's standpoint, political matters such as aligning with the U.S. election calendar or someone's term of office are not factors for consideration." In connection with this, U.S. Commerce Secretary Howard Lutnick claimed the previous day at Micron's concrete-pouring ceremony for its fab in Clay, New York, "I want to bring in competitors Samsung Electronics and SK hynix to the U.S. and have them build production facilities," and "Since Micron is leading the way, its competitors will feel jealous and will ultimately have no choice but to follow." At the event, Micron raised its investment amount in the U.S. from the previous $200 billion (about 300 trillion won) to $250 billion (375 trillion won) in just two months. Until the launch of the second Trump administration, Micron had been a company that built its production bases in Asia, including Japan and Taiwan, rather than the U.S. Not only Secretary Lutnick, but also U.S. Trade Representative (USTR) Jamieson Greer warned at Micron's memory chip plant expansion event in Virginia on May 22, "There will not be a full-scale product tariff on semiconductors right away, but we will impose one at the appropriate time."
Instead, Chairman Choi noted that if SK hynix builds a production facility in the U.S., it would be to meet the requests of local customers rather than due to political considerations. Choi said, "The fact that the U.S. has the largest market and many customers is important," adding, "Because customers want supply chain stability through a U.S. plant, we will decide according to their positions."
Chairman Choi also repeatedly urged that even if SK hynix builds an additional plant in the U.S., this should not be interpreted as a contraction of Korea's manufacturing capacity. Choi stressed, "We need more supply capacity, and this industry is no longer a zero-sum game," adding, "We are of course considering the option of investing in the U.S., but that doesn't mean we will definitely build a plant here."
"There are constraints on building memory plants, but even ordinary people are using enormous amounts of AI tokens"... Actively rebutting the semiconductor peak theory
At the correspondents' meeting, Chairman Choi once again lent weight to the prediction that the surge in AI demand will continue for a considerable period. Choi diagnosed, "When demand increased, there was a boom; when supply increased, there was a downturn — but now it clearly no longer moves in the same cycle as before," adding, "Right now, the gap in the pace of growth between demand and supply is enormous." His message was that while memory chip supply faces constraints because production facilities must be carefully selected, demand shows no sign of halting its surge amid rising AI token usage. Choi said, "Because even ordinary people are using an enormous amount of AI tokens, the KV (Key Value) cache that must be stored somewhere without being erased is increasing," and "The AI we see now is only at the level of a 4- to 5-year-old child." Choi added, "For AI to grow into AGI (Artificial General Intelligence — AI that learns, reasons and solves problems on its own like a human), it must learn a very large amount of information, and the storage medium for that ultimately has to be memory chips," adding, "As the technology revolution continues, technologies that use less HBM and DRAM may advance, but there is little way to stop the phenomenon of memory itself increasing."
In connection with this, Chairman Choi shared an anecdote that the customers he met when he stopped by California before coming to New York repeatedly raised only the common question, "How will you increase production and supply?" Choi said, "If it were demand that would end in a year or two, we wouldn't even have drawn up (expansion) plans," and "Fixed-rate style requests have almost disappeared, and customers are demanding far more memory chips than I had thought. We are trying to build supply facilities as quickly as possible, but you can't just build a memory chip plant readily even if you have the money."
Chairman Choi also cited the fact that other industries could contract if memory chip prices rise too much as a reason SK hynix is aggressively seeking to expand supply. Choi pointed out, "If memory prices become too expensive, traditional industries such as retail and automobiles will face difficulties, and the semiconductor market will die too," adding, "When I go to Japan they say they are reviewing a Japanese plant, and when I go to the U.S. they say they are reviewing a U.S. plant. Even carrying out investment at the maximum would not be enough."
Regarding the steep pursuit by China's semiconductor industry, Chairman Choi argued, "By the time you feel threatened, it's already too late," adding, "We have to move a bit faster and also expand our AI technology portfolio further." Choi said, "Chinese companies are moving from losses to profits, and they continue to generate the capacity for capital expenditure through IPOs as well," adding, "We are prepared for China to catch up at a fairly fast pace."
Choi hints at reviewing a stock split for Korean shares... Wall Street also anticipates ADRs from other overseas companies such as Samsung Electronics
In particular, Chairman Choi drew attention that day by mentioning the possibility of a stock split for SK hynix's common shares listed in Korea. In fact, according to a U.S. Securities and Exchange Commission (SEC) filing, one SK hynix ADR corresponds to one-tenth of a Korean common share. This means the ease of stock trading has been applied differently between Korea and the U.S. Calls for a stock split were also raised at SK hynix's regular shareholders' meeting last March. At the time, CEO Kwak answered, "We must comprehensively examine not only the stock price but also trading volume, investor composition and market outlook," and "We will review it carefully while closely watching the company's growth trajectory and the trend of the stock price rise."
Regarding the stock split, Chairman Choi said, "I don't yet have knowledge in that area, so I haven't looked into the topic," while adding, "If the chief financial officer (CFO) requests it, we will of course do it." Later, when Song Hyun-jong, president of SK hynix, who was in attendance, hinted, "It can be reviewed," Choi lent weight to the working-level opinion, saying, "Everything should be reviewed." Choi said, "In a perfect market, the price of the ADR and the Korean stock should be the same, but because market characteristics and people's preferences differ, there may be times when a gap arises," while dismissing the idea, saying, "The ADR listing does not mean shrinking the Korean stock market or breaking up its size."
Regarding the outlook for SK hynix's ADR share price, Chairman Choi pledged, "We will grow and put into practice our future growth potential so that it does not fall below the offering price of $149," adding, "We will also continue strategic investment in the AI sector." Choi emphasized, "In the AI era, we have the task of raising execution speed 10 times faster than in the past," adding, "I trust SK hynix's speed."
Regarding the handling of its stake in Japanese NAND flash maker Kioxia (formerly Toshiba Memory), Chairman Choi answered that it was "undecided." Earlier, in 2018, SK hynix invested 4 trillion won in a fund set up by U.S. private equity firm (PEF) Bain Capital to acquire Toshiba's NAND flash division, thereby coming to hold Kioxia convertible bonds (CBs) and other assets. Kioxia, which was subsequently listed on the Prime Market of the Tokyo Stock Exchange (TSE) on Dec. 8, 2024, saw its stock price rise more than 70-fold on the back of the AI boom, and last month — 18 months after its listing — it overtook Toyota to become the top company by market capitalization on the Japanese stock market. SK hynix is estimated to have recovered more than 6 trillion won in cash during the process of Bain Capital selling all of its stake. On top of this, SK hynix still holds CBs estimated at more than 50 trillion won. Kioxia is also preparing for an ADR listing on the U.S. stock market, targeting next year. Choi said, "Kioxia's stock price is also rising, and we will keep all possibilities open and decide strategically."
On the first day of SK hynix's ADR listing, major indexes on the New York stock market — the Dow Jones Industrial Average (0.29%), the Standard & Poor's (S&P) 500 (0.42%) and the Nasdaq Composite (0.29%) — The session ended on a positive note, with both rising in a resilient showing. Above all, Wall Street expected the listing to boost demand for ADR listings by other overseas companies such as Samsung Electronics, potentially energizing the capital-raising market. In an interview with Bloomberg TV that day, Nasdaq President Nelson Griggs said, "SK hynix's 'blockbuster' listing is becoming a catalyst for other global companies to consider U.S. IPOs."
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