South Korea's storage giants kick off a frenzy of capacity expansion worth billions of dollars! Semiconductor equipment enters the super windfall of AI computing power shortage.

According to the latest report from South Korean media, the two global storage chip superpowers - South Korean storage giants Samsung Electronics and SK Hynix are preparing to announce a new round of investments worth billions of dollars next Monday to significantly expand the capacity of HBM/DRAM/NAND storage chips and build new large data centers or industrial parks. In addition, another storage chip manufacturer - the US-based storage chip giant Micron Technology, Inc., announced in its latest financial report on Thursday that the company plans to increase its capital expenditure plan for the 2026 fiscal year by $5 billion to a record $25 billion scale. These signs of the latest expansion of the storage giants highlight that semiconductor equipment giants such as ASML Holding NV ADR, Lam Research, and Applied Materials are entering a new round of supergrowth driven by the mass production of AI chips and storage chips. From the perspective of expansion logic, ASML Holding NV ADREUV/DUV lithography machines are not ordinary semiconductor equipment, but bottleneck tools for further shrinking and improving the yield of advanced logic chips, AI accelerators, and HBM-related high-end DRAM processes; In addition, shortages of AI chips, tightness in HBM/DRAM, and structural increases in NAND demand all point to bottlenecks and constraints in similar AI computing infrastructure supply: advanced computing power is not just a long-term shortage of GPU/TPU, but a lack of wafer capacity, advanced chip processes, advanced packaging capacity, a huge gap in storage chip capacity, and etching/deposition/measurement control/advanced packaging equipment and lithography throughput capacity; at the same time, Wall Street analysts believe that this supply bottleneck is repricing the semiconductor equipment chain from "cyclical recovery trading" to "AI computing power capital expenditure supercycle trading". According to the South Korean daily newspaper "Daily Economic News" reported on Friday, Samsung Group will announce an unprecedented spending plan for the next ten years of up to 100 trillion Korean won (approximately $646 billion), including a possible investment of 30 trillion Korean won to build a chip factory in southwest South Korea. This will be the largest spending plan of its kind in South Korean history. The report stated that executives from Samsung and SK Hynix are expected to attend a presidential briefing at the Blue House in South Korea early next week. Samsung and SK Hynix are the top two companies in South Korea by market value, as well as leading global giants in the memory chip manufacturing industry. South Korean storage chip giants prepare for the largest-scale spending in history A senior spokesman for the Blue House said on Thursday local time that South Korean President Lee Jae-myung will host a "national briefing on the three super projects for the great leap of the Republic of Korea" on Monday, and added that more details will be announced on that day. During the preparation of the event, the high-level executives of the two major storage chip giants are reported to have met with the president to discuss an unprecedented plan for domestic investment in South Korea. Kim Yong-beom, head of the presidential policy office, stated, "In general, we think this is very positive." "Larger-scale investments associated with AI computing infrastructure and semiconductor manufacturing equipment should improve the long-term demand visibility for AI infrastructure, including AI chips, storage chips, and the broader AI computing infrastructure supply chain." Representatives of Samsung and SK Hynix declined to comment on these reports. Based in Icheon, South Korea, SK Hynix has hinted at plans to invest a huge amount of money to expand the capacity of HBM/DRAM/NAND storage chips comprehensively and meet the explosive demand for storage chips in the global artificial intelligence industry and the broader technology industry under the wave of AI infrastructure. The company plans to raise $29 billion in the US stock market. Earlier this month, Choi Tae-young, chairman of the SK Group, said he planned to double the capacity of storage chips in the next five years. Choi Tae-young told reporters at the 2026 Computex conference in Taipei, China, in June that the storage manufacturer is dealing with a severe shortage of storage chips that is likely to continue until 2030. Although SK Hynix plans to significantly increase investment to expand the capacity of HBM/DRAM/NAND storage chips, Choi Tae-young did not disclose how much money the company plans to spend. Headquartered in Suwon, Samsung has, like SK Hynix, announced record sales and operating profits in recent quarters due to booming demand for storage chips, while also showing interest in expanding capacity in the field of global AI computing infrastructure - such as challenging the dominant position of Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR in advanced process AI chip foundry. The report from the "Daily Economic News" stated that the chairman, Lee Jae-yong, is expected to announce a large-scale investment plan for a data center in Yashan, Chungcheongnam-do on July 2. SK Hynix, Samsung Electronics, and Micron Technology, Inc. (MU.US) based in the US, together, dominate the supply and demand structure of the global memory chip market and have been the main beneficiaries of the prosperity of data center construction driven by the exponential expansion of AI training/inference computing power demand. Both of these two South Korean memory chip giants consider NVIDIA Corporation (NVDA.US) as one of their largest customers. GPU/TPU/AI ASICs are responsible for processing transformer matrix multiplication workloads and generating intelligence, HBM/DRAM is responsible for high-speed reads, enterprise-level NAND/eSSD is responsible for hot data and cache, and HDD is responsible for long-term storage of massive amounts of cold/warm data. Therefore, financial giants on Wall Street like Goldman Sachs Group, Inc. believe that the AI computing power arms race led by cloud computing giants is turning storage chips from cyclical commodities into scarce strategic assets, and the price increase of DRAM/NAND in 2026 is not the end, but may be the initial stage of a supercycle. Following Samsung Electronics into the trillion-dollar market cap club, another South Korean memory chip giant SK Hynix recently also surpassed a market value of $1 trillion and, together with Samsung Electronics, has been promoting the benchmark stock index of the South Korean stock market - the KOSPI Composite Index to repeatedly hit new highs. The core behind this is the near limitless HBM/DRAM/NAND storage demand driven by AI training/inference computing tasks and the expectation of rising storage chip prices. With the soaring bullish trajectory of the stock prices of the two largest memory chip manufacturers in the world, Samsung Electronics and SK Hynix, the KOSPI index of the South Korean stock market has doubled in less than 6 months this year, making the nearly 80% increase in 2025 seem insignificant. AI chips and storage dual-engine ignition drive semiconductor equipment towards a supercycle! ASML Holding NV ADR, Applied Materials, KLA, and Lam Research on the eye of the AI computing power scarcity storm For semiconductor equipment manufacturers, expanding the production of storage chips is not simply about adding more production lines, but requires tremendous investment in building more clean rooms, as well as driving the strong demand for lithography, etching, deposition, measurement, material engineering, and advanced packaging equipment required for HBM, advanced DRAM, enterprise-level SSDs, 3D NAND, and advanced packaging. The latest research report from Wells Fargo & Company, a Wall Street financial giant, shows that benefiting from the expansion of 3nm, 2nm, and even more advanced chip processes, as well as the accelerated expansion of CoWoS/3D advanced packaging capacity, and DRAM/NAND storage chip capacity, the long-term bull market logic of the semiconductor equipment sector is becoming increasingly robust. Wells Fargo & Company stated that global semiconductor equipment manufacturers such as ASML Holding NV ADR (ASML.US), Applied Materials (AMAT.US), Lam Research (LRCX.US), and KLA (KLAC.US) are expected to continue to show positive performance in the second quarter, while raising its expectation for the overall equipment expenditure of the wafer fab in 2027 from about $180 billion to about $190 billion. Analysts who are optimistic about the stock prices and fundamentals of the semiconductor sector believe that any dynamic regarding the expansion of production capacity of chip manufacturers such as Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR, Samsung, is a positive catalyst for ASML Holding NV ADR, covering EUV lithography, and semiconductor equipment giants focusing on etching, film deposition, and CMP in advanced process technologies and 2.5D/3D advanced packaging. ASML Holding NV ADR benefits from the increase in layers and logic process expansion in advanced DRAM/EUV; Lam Research benefits from the complexity increase in high aspect ratio etching/deposition and stacking in HBM, DRAM, and 3D NAND; Applied Materials benefits from the demand for various types of customized advanced process equipment brought by the expansion of DRAM, advanced packaging, material engineering, and AI chip demand. ASML Holding NV ADR, Applied Materials, Lam Research Group, and KLA are the semiconductor equipment giants that Wells Fargo & Company and Citigroup are optimistic about. In semiconductor factories, Applied Materials is ubiquitous. Unlike ASML Holding NV ADR, which has always focused on lithography, Lam Research's focus is more on etching, cleaning, patterning, and key film processes, especially in the high aspect ratio (HAR) etching/deposition and related processes required for 3D NAND storage. The high-end equipment provided by Applied Materials plays a key role in almost every step of chip manufacturing, covering important processes such as atomic layer deposition (ALD), chemical vapor deposition (CVD), physical vapor deposition (PVD), rapid thermal processing (RTP), CMP, wafer etching, and ion implantation. Compared to ASML Holding NV ADR and Applied Materials, KLA focuses on the detection stage. Especially in the areas of chemical process control and chip yield monitoring in chip manufacturing, its breakthroughs in wideband plasma optical inspection technology and advanced chip defect synchronous fine inspection systems provide semiconductor manufacturers with more powerful tools to improve production efficiency and product quality. Its advanced technology and equipment occupy an important position in the industry and are widely used in various semiconductor manufacturing processes. Another Wall Street giant Citigroup stated that in an optimistic scenario, the global WFE market size is expected to increase from about $145 billion in 2026 to $200 billion in 2027 and $250 billion in 2028, and the target price for Applied Materials has been raised from $550 to $710, for Lam Research from $315 to $450, and for KLA from $206 to $290. At the same time, the multi-step inference driven by the AI intelligent entity led by Anthropic will dramatically amplify the demand for KV cache and intermediate state storage. When high-cost HBM and DRAM cannot economically accommodate all memory requirements, NAND, XL-Flash, high-performance storage layers, and related process equipment demand will be systematically heightened. This is also the key logic for the target prices of AMAT, LRCX, and KLAC to be adjusted upwards by Citigroup.