Citi | Intel (INTC.US): Potential Collaboration with SK hynix
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According to Reuters (16 September 2026), SK hynix is in exploratory talks with Intel that could bring memory chip production to the US for the first time, with potential structures including leasing capacity at Intel's Ohio fabs or a joint venture between Intel and large cloud providers. Citi views the report as consistent with Intel management's comments at the AI Infra Summit a day earlier: Intel will not build every capability in-house, will partner where others are stronger, and will focus on areas where it can lead, such as advanced packaging including EMIB-T. Citi suggests the talks may be a further step in Intel's expanding cooperation with SpaceX, with SK hynix/Intel US-based memory manufacturing complementing Intel's 14A and advanced packaging products. Citi's charts note that a deal would create SK hynix's first US memory production base—its current US footprint is HBM advanced packaging with mass production from 2H29—and could ease Trump administration pressure on domestic manufacturing; SK hynix is reportedly developing EMIB-based 2.5D packaging with HBM, while Intel itself rules out making memory. Citi maintains a Buy with a $130.00 SOTP-based target price, implying 33.8% upside from $97.14 (15 September 2026). Key risks include roughly 90% of sales from PC/server businesses, top PC OEMs at about 45% of revenue, and AMD competition.
Key exhibits
Exhibit 1
