Nvidia and SK Hynix sign a $500 billion deal to lock down AI memory supply
The agreement covers specialised memory chips that every powerful AI processor needs, and it comes with plans for massive new data centres in South Korea.
Key points
- Nvidia and South Korean chipmaker SK Hynix announced a deal on Friday worth up to $500 billion over multiple years.
- The agreement includes large-scale data centres expected to come online in 2027, targeting 2 gigawatts of power capacity.
- SK Hynix affiliate SK Telecom will build a cloud business using Nvidia's Vera Rubin systems, Nvidia's next generation of AI computing hardware.
- Nvidia is separately investing $1 billion into Naver, a Korean cloud company building data centres around Nvidia's chips.
- SK Hynix listed on the Nasdaq stock exchange earlier in July 2026 to help finance its infrastructure expansion.
Nvidia has struck what could be a $500 billion supply agreement with South Korean memory chipmaker SK Hynix, securing a critical ingredient for its artificial intelligence processors. Announced Friday evening in San Francisco at an AI summit attended by South Korean President Lee Jae Myung, as reported by CNBC Tech, the deal spans multiple years and touches everything from raw memory supply to new data centre construction.
Why does Nvidia need this deal so badly?
The AI boom has created a shortage of high-bandwidth memory, or HBM: the fast, high-capacity memory chip that sits directly on Nvidia's AI processors and lets them handle enormous amounts of data at speed. Without enough HBM, Nvidia can't build enough of the chips that data centres and tech companies are scrambling to buy.
SK Hynix is the world's leading HBM producer, according to industry analysts. Locking in supply now gives Nvidia a real advantage over rivals.
"The expansion will include a co-develop opportunity for us on the next-generation SK Hynix AI memory, and this will help us secure a stable supply of HBM memory," said Raj Mirpuri, Nvidia's enterprise vice president, on a call with reporters.
As we reported on 27 July 2026, the San Francisco summit also saw South Korea and Nvidia open a joint AI lab, part of a broader push by Seoul to become a serious player in global AI.
What is actually being built?
This goes well beyond a purchase order. It includes large-scale data centres, the giant warehouse-like facilities packed with computer hardware that power AI services, expected online in 2027.
Nvidia's 2-gigawatt power target, roughly the output of two large power stations, indicates hundreds of thousands of GPUs (graphics processing units, the specialised chips that do the heavy number-crunching AI requires). SK Hynix's affiliate SK Telecom will build a cloud computing business on top of Nvidia's Vera Rubin systems, the company's next generation of AI hardware platforms.
Nvidia will also invest $1 billion into Naver, a major Korean internet and cloud company, for additional data centre capacity targeting 200 megawatts. Customers in South Korea and globally can book AI computing time before that facility is finished.
What does this mean for ordinary people?
Until now, the biggest AI infrastructure projects have been driven almost entirely by a small group of US tech giants: Microsoft, Google, Meta and Amazon. South Korea's government and its corporate conglomerates stepping in as major builders signals that AI computing power is spreading to new regions.
For consumers and businesses in South Korea, that means more places to access AI services and, over time, greater competition on price and availability. The shift matters: it's the difference between one country controlling the pipes and several.
SK Hynix listed on Nasdaq earlier in July 2026 specifically to raise capital for exactly these kinds of projects.
