Bank of Korea Rebuts "AI Chip Peak" Thesis — HBM Customization Caps Supply Expansion
TL;DR
Bank of Korea rebuts "chip cycle peaked" thesis, citing HBM customization bottleneck; Samsung down 9%, SK Hynix 15% last week.
The Bank of Korea (BOK) released a report on July 13 directly rebutting investor concerns that the "AI chip cycle has peaked" — the global semiconductor market remains undersupplied and the AI-driven super cycle is expected to continue for some time.
The backdrop: Samsung Electronics and SK Hynix collapsed together last week. Samsung fell over 9% on July 2 alone, SK Hynix nearly 15%. Last Tuesday, Samsung announced Q2 operating profit close to 90 trillion won (~$65B, above market expectations), and the stock still dropped 7% that day — the market has priced in "AI cycle peak" early.
BOK's rebuttal has three points: (1) this cycle differs from prior chip cycles, driven by competitive corporate investment in AI infrastructure; (2) supply expansion pace is meaningfully constrained because the market-leading product is HBM, a customized memory that can't scale like commodity DRAM; (3) major banks including JPMorgan, Goldman Sachs, and Morgan Stanley all forecast the global semiconductor market remains robust through at least 2027.
The same report adds a caveat: "Uncertainty remains around AI's adoption speed, application scope, and ultimate profitability" — the central bank leaves itself a retreat door on its own optimism.
The Korean government just finalized a $57.6 billion AI chip investment plan with Samsung and SK Hynix — BOK's report has a very clear political function: underwriting the $57.6B the Korean government just signed off on. This is quite aggressive stance-taking by central bank standards.
via The Korea Times / The Korea Herald
The backdrop: Samsung Electronics and SK Hynix collapsed together last week. Samsung fell over 9% on July 2 alone, SK Hynix nearly 15%. Last Tuesday, Samsung announced Q2 operating profit close to 90 trillion won (~$65B, above market expectations), and the stock still dropped 7% that day — the market has priced in "AI cycle peak" early.
BOK's rebuttal has three points: (1) this cycle differs from prior chip cycles, driven by competitive corporate investment in AI infrastructure; (2) supply expansion pace is meaningfully constrained because the market-leading product is HBM, a customized memory that can't scale like commodity DRAM; (3) major banks including JPMorgan, Goldman Sachs, and Morgan Stanley all forecast the global semiconductor market remains robust through at least 2027.
The same report adds a caveat: "Uncertainty remains around AI's adoption speed, application scope, and ultimate profitability" — the central bank leaves itself a retreat door on its own optimism.
The Korean government just finalized a $57.6 billion AI chip investment plan with Samsung and SK Hynix — BOK's report has a very clear political function: underwriting the $57.6B the Korean government just signed off on. This is quite aggressive stance-taking by central bank standards.
via The Korea Times / The Korea Herald
