Intel, SK Hynix shares rise on report of talks to make memory chips in the U.S.
SK Hynix is in talks with Intel to make memory chips in the U.S., Reuters reported, sending shares of both companies higher.
Intel shares rose 5%, while SK Hynix's Nasdaq-listed American depositary receipts gained 3%.
Citing people familiar with the matter, Reuters reported that under one scenario SK Hynix would lease part of Intel's chipmaking facility in Ohio. The two companies could also form a joint venture that would include Intel and major cloud firms, and SK Hynix is considering other ways to structure a deal, the news agency said. One source told Reuters the talks are exploratory and no decisions have been made.
Intel and SK Hynix did not immediately respond to CNBC's request for comment on the report.
A deal would be a significant win for Intel, which has been seeking marquee customers for its contract manufacturing, or foundry, arm, a key pillar of CEO Lip-Bu Tan's strategy. The arrangement could also support the U.S. government's push to bring more semiconductor production to the country.
SK Hynix is one of the world's leading suppliers of high-bandwidth memory, or HBM, a component used in Nvidia's chips, and it also produces other types of memory chips that are crucial for AI applications.
Reuters reported, citing three sources, that an agreement to manufacture advanced memory such as HBM in the United States could face opposition from the South Korean government because the technologies are considered sensitive.
SK Hynix listed its American depositary receipts on the Nasdaq in July and has been a major beneficiary of the AI boom. The rush to build data centers has created a shortage of memory chips, sharply driving up prices and enabling SK Hynix and rival Samsung to post large profits. SK Hynix's South Korea-listed stock is up 400% over the past year.