SK Hynix Pulls Plug on Memory-Chip Unit U.S. IPO On Market Jitters —Update

By P.R. Venkat

SK Hynix halted plans to list its memory-chip unit in the U.S., becoming the latest casualty of market turmoil that is stalling a rush of multibillion-dollar fundraisings by companies tied to the artificial-intelligence boom.

The South Korean company--the world's second-largest memory chip maker--said Friday that its Solidigm subsidiary suspended a review exploring an initial public offering as an option to get funding for a new fabrication facility in the U.S.

"While an IPO was expected to ease investment burdens and expand capacity for shareholder returns, the review has been discontinued in light of market conditions and share price trends," SK Hynix said.

Volatility in financial markets has increased, contributing to a broader correction in semiconductor stocks, it added.

SK Hynix's shares fell as much as 4.2% in early trade in Seoul before recouping some ground, whipsawing between gains and losses. The stock is down about 30% this quarter, LSEG data show, and bouts of selloffs have roughly halved the company's market capitalization from the peaks hit in June.

Prolonged geopolitical uncertainty, rising interest rates and a jittery stock market have cooled investors' appetite for AI-related trades, curbing the flow of listings. A source of concern is that AI's payoff won't justify the massive sums being spent on the technology, threatening a boom that has driven up valuations of firms in the AI supply chain.

Earlier this month, Australian data-center operator Firmus Grid cited market volatility in cancelling a planned IPO of almost $5 billion that would have been the country's largest in nearly 30 years. Days later, Blackstone-backed Airtrunk delayed a planned Singapore listing to the first half of next year over similar concerns, The Wall Street Journal reported.

On Friday, SK Hynix said that the decision to discontinue the Solidigm IPO review doesn't reflect any change in the subsidiary's growth prospects or investment needs.

"SK Hynix will also continue to assess investment timing, scale, and financing methods while exploring various options to support Solidigm's growth and enhance value for existing shareholders," it added.

Raising external capital through an IPO could have increased SK Hynix's consolidated cash flow, freeing up funds for both factory investment and shareholder returns such as dividends and share buybacks, the statement said.

A listing at an appropriate valuation could also have helped the market recognize Solidigm's growth potential, which SK Hynix said isn't adequately reflected in its current corporate value.

SK Hynix established Solidigm as a U.S. subsidiary to run the solid-state-drive and NAND business that it acquired from Intel as part of a $9 billion deal agreed in October 2020.

In July, SK Hynix raised $26.51 billion through a U.S. listing of American depositary receipts that was the largest share sale ever by a non-U.S. company, topping the $25 billion raised by Alibaba in 2014.

Write to P.R. Venkat at venkat.pr@wsj.com

(END) Dow Jones Newswires

October 22, 2026 21:55 ET (01:55 GMT)