The market valuations of chip manufacturers SK Hynix and Micron have surpassed $1 trillion, driven by increased demand for artificial intelligence (AI) data centers. SK Hynix, a supplier to Nvidia, experienced a 10% share price increase on Wednesday, contributing to a more than threefold rise in its stock value since the beginning of the year. Micron's shares also saw a significant increase of nearly 20% following an upward revision of its stock price target by UBS.
Both companies now join other technology firms such as Nvidia, Amazon, Apple, Microsoft, Alphabet, and Meta with market capitalizations exceeding $1 trillion. The global demand for advanced chips used in AI applications has led to a rise in the share prices of associated companies. This heightened demand has also contributed to a global shortage of memory chips, boosting sales for manufacturers like SK Hynix and Micron.
Earlier in May, Samsung Electronics, another significant semiconductor manufacturer, reached a valuation of approximately $1.34 trillion, with its shares more than doubling this year. It became the second Asian company, after TSMC, to achieve the $1 trillion milestone. Samsung's stock saw an additional jump of over 6% following a union vote in favor of a pay deal, thereby avoiding a potential strike.
The performance of these chipmakers coincides with a record high for South Korea's Kospi stock index, which is heavily influenced by technology companies. While Nvidia has seen substantial gains, reaching a $5 trillion market value, concerns about increasing competition in the sector have been noted. Other major tech firms like Microsoft and Apple have also recently crossed the $4 trillion valuation mark, though some investors have raised questions about potential overvaluation in the AI sector.
