SK Hynix and Samsung Electronics shares fell after Chinese startup DeepSeek unveiled its V4.1 Flash AI model. This new model requires significantly less high-bandwidth memory (HBM) and solid-state drive (SSD) storage.
SK Hynix shares dropped over 2% in Seoul trading. Samsung Electronics shares fell by more than 3%.
DeepSeek's technology achieves efficiency by reducing the size of the KV cache used for temporary memory. This breakthrough sparked investor concerns regarding a potential slowdown in surging memory chip demand. The development raises questions about the long-term HBM outlook despite expected growth in overall AI usage.