Intel (INTC) has spent years trying to turn its manufacturing network into a business that can serve customers beyond its own chip divisions.
That effort gained a possible new partner on Wednesday, Sept. 16.
SK Hynix (SKHY) is in exploratory talks with Intel about producing memory chips in the U.S., Reuters reported. The discussions could involve Intel’s delayed manufacturing project in Ohio.
No agreement has been reached, and Reuters could not determine which type of memory would be produced.
Intel shares were up about 5.6% following the report.
Bank of America analyst Vivek Arya currently rates Intel Buy with a $145 price target.
SK Hynix weighs 2 routes into Intel’s Ohio project
Reuters reported that SK Hynix could lease part of Intel’s planned Ohio manufacturing complex or participate in a joint venture involving Intel and large cloud companies looking to secure future memory supplies.
Either structure could create a new outside use for part of Intel’s Ohio project.
Intel slowed construction of the site in 2025 as it moved to align new manufacturing investment more closely with market demand.
The company has said to operate efficiently, its advanced manufacturing technologies need more production volume than Intel’s own products are expected to provide. Intel also said it still has relatively few external foundry customers.
The company’s latest results show how much of the manufacturing business still depends on its own product divisions.
Intel Foundry by the numbers
- $5.77 billion: Intel Foundry’s second-quarter revenue.
- $293 million: Revenue from external foundry and assembly-and-test customers.
- $2.09 billion: Intel Foundry’s operating loss for the quarter.
Intel reported about $5.5 billion of intersegment Foundry revenue during the quarter, meaning most of the unit’s reported sales still came from other Intel businesses.
External revenue also increased partly because Altera became an outside customer after Intel sold a controlling stake in that business.
A SK Hynix arrangement would not necessarily make the memory company a traditional Intel Foundry customer.
Under the lease scenario, SK Hynix could gain access to part of Intel’s planned Ohio manufacturing complex.
A joint venture could create a different relationship, potentially connecting the project with cloud companies seeking future memory supply.
The financial benefit to Intel would depend on the final structure.
BofA says AI memory capacity could tighten in 2027
BofA analysts who attended this week’s AI Infra Summit said memory bandwidth and capacity were the broadest and tightest physical constraints discussed by chip suppliers, AI labs, and data-center operators.
The analysts expect memory constraints could become even tighter in 2027, according to a Sept. 15 report shared with TheStreet.
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AI accelerators need fast access to large amounts of memory so processors can keep receiving the data required to perform calculations.
More AI models and inference requests therefore require additional memory capacity alongside GPUs and other accelerators.
That gives cloud operators a reason to secure future memory supplies before the chips are needed.
Intel has already encountered similar component shortages in its own business.
The company said second-quarter demand exceeded the amount of product it could supply because of internal manufacturing constraints and industry-wide shortages.
Intel expects shortages of memory, substrates, and other critical components to persist into 2027.
BofA’s conference checks also found no signs of slowing in AI infrastructure capacity investment.
Memory ranked ahead of power and interconnect among the physical bottlenecks highlighted in the report.
Intel sold its NAND business to SK Hynix six years ago
Intel and SK Hynix have already completed one major memory transaction.
Intel agreed in 2020 to sell its NAND flash-memory and storage business to SK Hynix.
SK Hynix paid about $6.6 billion in 2021 and another $2.2 billion in 2025. The transaction included Intel’s NAND manufacturing facility in Dalian, China, along with intellectual property and employees.
SK Hynix created U.S.-based Solidigm to operate much of the acquired business.
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Six years later, the companies are discussing a different relationship.
The company that bought Intel’s NAND assets could now become a user or partner at an Intel U.S. manufacturing site.
That would not mean Intel is rebuilding the memory-design business it sold.
Under the options reported by Reuters, SK Hynix could bring memory-manufacturing expertise. Intel could provide access to part of the Ohio site or related infrastructure.
Reuters also reported that large cloud companies seeking to secure future memory supply could also participate if the companies pursue a joint venture.
An Intel-SK Hynix deal still faces major hurdles
No transaction has been finalized. SK Hynix said it is reviewing different options for expanding its production footprint but has made no final decision. Intel declined to comment on the reported talks.
The companies also have not disclosed what kind of memory could be produced in Ohio.
SK Hynix makes DRAM, NAND flash, and high-bandwidth memory, or HBM.
Reuters has not confirmed that the proposed Ohio project would produce HBM.
HBM is one of the most important memory components used with AI accelerators. A project involving advanced DRAM or HBM could also face scrutiny in South Korea over the transfer of strategically important memory technology, according to Reuters.
Costs present another hurdle.
Manufacturing memory chips in the U.S. can be more expensive than producing them in Asia, and any lease or joint venture would need a financial structure that makes U.S. production economical.
For Intel investors, the next evidence will come from specific commitments rather than the talks themselves.
A signed lease would show that SK Hynix intends to use part of the Ohio project.
A joint venture agreement would clarify whether cloud companies are prepared to participate.
Details on the memory technology, committed production capacity, and manufacturing timeline would show whether the discussions are turning into an operating project.
Until those commitments emerge, the Sept. 16 rally reflects a potential new use for Intel’s Ohio manufacturing assets, not a signed production program.
