SK Group is weighing plans to build a chip manufacturing facility in Japan while seeking closer collaboration with Kioxia. SK Group Chairman Chey Tae-won has indicated that the two companies could jointly produce NAND flash memory in Japan, with additional cooperation potentially covering supply chain coordination and joint research and development. If such a partnership materializes, the combined NAND market share of SK hynix and Kioxia would surpass that of Samsung Electronics Co., Ltd., potentially reshaping the global memory chip competitive landscape.
On September 2, reports emerged that during his Tokyo visit this week, Chey Tae-won described joint production with Kioxia as "one of the options." He noted that Japan is "very attractive" in terms of risk management and cultural alignment, adding that SK Group has received investment proposals from multiple Japanese local governments, though no specific site has been disclosed.
Chey also stated that if SK hynix could be incorporated into Kioxia's future strategy, "we are ready to be a partner at any time," citing the existing production collaboration between Kioxia and SanDisk Corp. as a reference. Other potential areas of cooperation could include supply chain coordination and joint R&D efforts.
Currently, Kioxia and SanDisk Corp. jointly operate NAND fabrication facilities in Japan but continue to sell their products independently. Chey hinted that if a deeper partnership cannot be established, SK does not rule out exiting its existing investment in Kioxia. Meanwhile, reports indicate SK Group is also exploring acquisitions of Japanese semiconductor materials and equipment companies to further expand its footprint in the local chip supply chain.
Where things stand
SK hynix and Kioxia occupy a delicate position as both competitors in the NAND market and as investor-investee, given SK hynix's indirect stake in the company. SK hynix previously participated in the acquisition of Toshiba's memory business through a special purpose company (SPC) led by Bain Capital. In August of this year, that SPC became Kioxia's largest shareholder with a 14.19% stake, and SK hynix holds securities convertible into a majority of the SPC's voting rights, giving it considerable potential influence.
However, under current agreements, SK hynix is restricted from directly or indirectly holding 15% or more of Kioxia's voting rights before 2028 without Kioxia's consent. This means that any further increase in SK hynix's control over Kioxia remains constrained in the near term.
Should the two companies deepen their cooperation, the global NAND market landscape could shift notably. According to Counterpoint Research data, in the second quarter of 2026, Samsung Electronics Co., Ltd. led NAND shipments with a 25% market share, followed by SK hynix at 22% and Kioxia at 14%. A simple combined calculation would give SK hynix and Kioxia a 36% share, significantly ahead of Samsung.
Leveraging HBM momentum for next-gen memory
This strategic move also ties into SK hynix's rapid growth in the HBM segment in recent years. Semiconductor engineering professor Lee Jong-hwan believes SK hynix may be attempting to convert the profits and confidence gained from its HBM leadership into further momentum for competing in the broader memory market.
At the same time, SK hynix is working with SanDisk Corp. in the U.S. to develop a global standard for high-bandwidth flash memory (HBF). This emerging technology stacks NAND chips to boost performance and capacity, with an architecture bearing some similarities to HBM. Kioxia's long-standing partnership with SanDisk Corp. could also provide additional strategic synergies for SK hynix's participation in HBF technology development.
Lee Jong-hwan pointed out that as the AI industry shifts from model training toward inference applications, demand for high-capacity NAND storage is expected to grow further, potentially opening new market opportunities for HBF. Compared with Samsung Electronics Co., Ltd., which spans multiple business areas including memory, foundry, and consumer electronics, SK hynix can concentrate more resources on memory chips, which could become a key advantage in its ongoing challenge to Samsung's dominance.
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