In this case, Solidigm's planned Chinese factory upgrades could be mutually beneficial, allowing funds to be transferred to the new U.S. plant. But that requires the U.S. government to give it permission to ship the machinery in the first place, something that is far from guaranteed. The Dalian factory produces NAND flash memory, the likes of which are used in everything from relatively simple devices to full-blown data centers. It also comes at a time when global NAND production is a hot-button topic. Samsung and SK hynix are upgrading their Chinese factories to produce more of the chips used in AI data centers in an attempt to meet growing demand. Manufacturers have already slashed production of consumer-focused memory in favor of the more lucrative data center-grade components, causing prices to spike globally. This volatility in the market as a whole was given as one of the reasons SK hynix chose to cancel a planned Solidigm IPO earlier this week.
Beyond dangling a $45 billion plant, Solidigm has also allegedly told the Commerce Department that its total investment in U.S. manufacturing could reach $100 billion eventually, with construction in New York penciled in for 2027. The company is fresh from its latest earnings call, where it announced revenues of $75 billion with $60 billion in operating profit, and $28 billion in net. The company made no mention of its Dalian plant or a planned US investment, but did warn that memory shortages are set to last through 2030.
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SK hynix denies playing hardball with Trump admin over 3D NAND fab
Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/tech-industry/manufacturing/SPONSORED_LINK_URL
- https://www.tomshardware.com/tech-industry/manufacturing/sk-hynix-owned-solidigm-is-plotting-a-new-usd45-billion-flash-memory-factory-for-the-us-report-claims-wants-go-ahead-to-export-equipment-for-china-upgrades-in-return#main
- https://www.tomshardware.com/membership
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Informational only. No financial advice. Do your own research.