Semiconductors

Memory semiconductor stocks trade at 47x forward earnings, sparking debate whether AI demand justifies valuations reminiscent of the dot-com peak. Samsung and SK Hynix have doubled since October, driven by enterprise AI server buildouts requiring high-bandwidth memory. The supercycle thesis assumes data center memory demand will triple by 2027, but supply additions from Chinese manufacturers could crater pricing. Investors betting on sustained margins face the same cyclical reality that has crushed chip stocks every five years for three decades.

The KOSPI closed at an all-time high as Samsung and SK Hynix rode AI chip demand to double-digit gains. Samsung's memory division reported 40% revenue growth quarter-over-quarter, driven entirely by high-bandwidth memory for AI training. The rally reflects South Korea's position as the only real alternative to Taiwan for advanced semiconductors, but it also prices in perfect execution on next-generation chip architectures. Any stumble in 3-nanometer production will hurt.