South Korea’s semiconductor equipment, materials, and components stocks surged in unison and seized market leadership following SK Hynix’s massive fab investment announcement. As of 10 a.m. on August 11, YEST had jumped 15.45%, Jusung Engineering climbed 13.74%, and other major equipment stocks posted strong gains including Wonik IPS (7.62%), Vm (7.54%), and Eugene Technology (6.26%). HBM-related stocks also rose together, with ISC up 6.05%, EO Technics up 4.34%, PSK Holdings up 4.29%, and Hanmi Semiconductor up 2.92%. Meanwhile, major memory stocks took a breather. Samsung Electronics (005930.KS) edged up just 0.54% to 231,250 won, while SK Hynix (000660.KS) fell 2.18% to 1,389,000 won.
The equipment stock rally gained momentum after SK Hynix confirmed investments in its second fab at the Yongin Semiconductor Cluster and the M17 facility in Cheongju. The previous day, stocks like Tes (11.40%), TCK (16.98%), and LTC (11.67%) had already posted double-digit gains, reflecting expectations of expanded capital expenditure. As major memory stocks face profit-taking following recent sharp gains and concerns about a peak in commodity memory, investment capital is rapidly rotating into equipment, materials, and components stocks.
The U.S. semiconductor market showed mixed performance. On August 10 (local time), the Philadelphia Semiconductor Index (SOX) closed down 2.94% at 11,993.86. Intel (INTC) plunged 4.06% after announcing a $15 billion share issuance to fund foundry expansion, while Coherent (COHR) tumbled 14.24% ahead of its earnings report, leading the index decline. Nvidia (NVDA) fell 2.86% to $217.55, and AMD (AMD) dropped 2.86% to $469.56.
Nvidia unveiled plans to raise over $500 billion in third-party capital for AI infrastructure. The company intends to form a financial platform with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR to attract funding, but market reaction was limited as specific commitment amounts and financial terms were not disclosed.
Brokerage views were divided. Mirae Asset Securities maintained target prices of 370,000 won (approximately $261) for Samsung Electronics and 2.8 million won (approximately $1,978) for SK Hynix, viewing the current range as an opportunity to increase positions at lows. In contrast, Kiwoom Securities lowered target prices to 350,000 won (approximately $247) and 2.1 million won (approximately $1,484), respectively, reflecting commodity memory peak-out concerns. Morgan Stanley assessed that the steepest phase of the memory stock decline has passed, while U.S. investment media outlet Motley Fool evaluated the recent correction as a buying opportunity, citing SK Hynix’s 56.4% HBM market share and low valuation.
Earnings improvements at semiconductor equipment and materials companies also supported investment sentiment. Simmtech posted second-quarter operating profit of 62.89 billion won (approximately $44.4 million), beating market expectations by 33%. Daishin Securities forecast third-quarter operating profit to reach 76.7 billion won (approximately $54.2 million), up 519% year-over-year. Hanmi Semiconductor reported record quarterly results with revenue of 251.1 billion won (approximately $177.4 million) and operating profit of 130.3 billion won (approximately $92.1 million), while Hanwha Semitech also swung to an operating profit of 14 billion won (approximately $9.9 million) from the previous quarter.
DRAM spot prices showed mixed trends by product. DDR4 16Gb (2Gx8) 3200 rebounded within a single day, swinging from a 0.48% decline the previous trading day to a 0.55% gain. DDR5 16Gb (2Gx8) 4800/5600, used in high-performance memory for AI servers, also rose 0.32%, extending its gains. Commodity DDR4 8Gb (1Gx8) 3200 remained flat.
Samsung Electro-Mechanics saw AI server component supply shortages emerge as an earnings improvement factor. Hana Securities maintained a target price of 3 million won (approximately $2,120), expecting high profitability to continue as MLCC and FCBGA demand grows rapidly while production capacity expansion remains limited. Samsung Electro-Mechanics raised MLCC distribution channel prices by approximately 10% in June and 30% in August, and FCBGA is expected to reach full operation in the second half, with server and network revenue share projected to exceed 60%.
The rise of China’s CXMT has emerged as a variable in the global memory market. CXMT is expanding adoption among global PC makers, aided by DDR5 yield improvements. Dell is reportedly limiting usage, and HP is restricting application to products sold in China, while Acer and Asus are relatively more active in adopting CXMT products. CXMT recently plans to raise up to 66.61 billion yuan (approximately $9.9 billion) through an IPO to invest in production line expansion and DRAM technology advancement, with its global DRAM market share estimated to have risen to the 7-8% level.
Reports also emerged that Apple is conducting product testing to apply CXMT memory semiconductors in iPhones and MacBooks for the Chinese market. However, bipartisan U.S. senators have demanded that Apple commit by August 21 not to use CXMT and YMTC semiconductors. The U.S. House Select Committee on the U.S.-China Strategic Competition has urged the administration to enforce regulations requiring customer screening at overseas foundries to block proxy orders by Chinese companies. These regulations were established after a chip designed by Sophgo and manufactured by TSMC was discovered in a Huawei AI processor. Strengthened enforcement could impose additional constraints on Chinese AI semiconductor companies’ access to overseas foundries.
Chinese AI semiconductor companies are posting steep revenue growth. Cambricon reported first-half revenue of 5.996 billion yuan (approximately $889 million), up 108.13% year-over-year, with net profit of 2.311 billion yuan, up 122.61%. Hygon also forecast revenue and net profit increases of up to 70.20% and 52.32%, respectively, while Moore Threads posted revenue of 1.736 billion yuan, up 147.42%, and reduced its net loss by 95.73%.
TSMC (TSM) is expanding advanced packaging investments. The company is in discussions to acquire AUO’s L7 and L5C plants in Taiwan to use as advanced packaging production bases for FOPLP, CoPoS, and other technologies, with the transaction potentially exceeding NT$30 billion. If the acquisition proceeds, related production could begin as early as the second half of 2028. TSMC is also pursuing plans with Sony to invest approximately ¥1 trillion (approximately $6.3 billion) to build a next-generation image sensor production base in Kumamoto, Japan.
South Korea’s semiconductor industry support legislation also took effect on August 11. The “Special Act on Strengthening Semiconductor Industry Competitiveness and Support” includes provisions for establishing five-year basic plans, creating a special committee under the president, and supporting semiconductor cluster infrastructure. The law also provides grounds for preliminary feasibility study exemptions, regulatory improvement requests, and a special account operating through the end of 2036. Semiconductor exports from August 1-10 reached $9.95 billion, up 155.4% year-over-year, accounting for approximately 46.7% of total exports.
Microsoft is reportedly planning to unveil its proprietary AI accelerator, “Maia 300,” as early as September and is in discussions with TSMC to secure production capacity for over 300,000 units for 2027 supply. With the 12-inch silicon wafers required for one AI server amounting to approximately 3.8 times that of a standard server, and HBM production of the same capacity requiring about three times more wafers than standard DRAM, wafer manufacturers such as Shin-Etsu Chemical, SUMCO, and GlobalWafers continue to face pricing pressure and supply constraints.