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AI Memory Shortage Boosts Legacy Chipmaker Jeju Semiconductor, Driving 18-Fold Profit Surge and Island Exports
🇰🇷 South Korea /Technology

AI Memory Shortage Boosts Legacy Chipmaker Jeju Semiconductor, Driving 18-Fold Profit Surge and Island Exports

From Dong-A Ilbo · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

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  • South Korea's Jeju Semiconductor has seen a massive surge in operating profit, up 18-fold year-on-year in the first quarter, driven by the global AI memory chip shortage.
  • The company specializes in legacy (older) memory chips, and increased demand for advanced chips has reduced supply of older ones, benefiting companies like Jeju Semiconductor.
  • Jeju Semiconductor's strong performance significantly boosted the island of Jeju's exports, with semiconductor exports alone exceeding last year's total by May.

The global shortage of AI memory chips is creating an unexpected boom for South Korea's Jeju Semiconductor, a company specializing in older, or legacy, memory products. While demand for cutting-edge chips has led manufacturers to reduce production of older models, this shift has created a lucrative niche for Jeju Semiconductor.

The company reported a staggering 1713% increase in operating profit for the first quarter, reaching 67.1 billion won. This remarkable financial performance has also had a significant impact on the island of Jeju's export economy. From January to May, Jeju's total exports surpassed the entirety of the previous year, with semiconductors accounting for 72% of this figure.

Jeju Semiconductor operates as a fabless design company, outsourcing its manufacturing to overseas foundries, primarily in Taiwan. This business model allows them to focus on design and capitalize on market shifts, such as the current demand for legacy chips amidst the broader memory supply crunch.

DistantNews Editorial

Originally published by Dong-A Ilbo in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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