SK Group Chairman Warns of Bottlenecks Due to Rapid Growth of AI Data Centers, According to Report
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 28 2025
0mins
Should l Buy NVDA?
Source: SeekingAlpha
AI Data Center Growth: SK Group Chairman Chey Tae-won highlighted that the rapid expansion of AI data centers is causing supply bottlenecks for chips and other essential components.
Global Competition in AI: Chey emphasized the intense global competition in AI, noting that major economies like the U.S. and China have implemented national strategies to gain an advantage.
Event Context: Chey made these remarks during a business event at the APEC summit in South Korea, attended by global business leaders, including U.S. President Donald Trump and Chinese President Xi Jinping.
SK Hynix's Role: SK hynix, a subsidiary of SK Group, is a significant supplier of High-Bandwidth Memory chips to Nvidia, which is positioned to benefit from the growing AI market.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 175.640
Low
200.00
Averages
264.97
High
352.00
Current: 175.640
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is a full-stack computing infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. The Company’s segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing platforms and artificial intelligence (AI) solutions and software; networking; automotive platforms and autonomous and electric vehicle solutions; Jetson for robotics and other embedded platforms, and DGX Cloud computing services. The Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems, and Omniverse Enterprise software for building and operating industrial AI and digital twin applications.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Revenue Growth Outlook: Analysts project Nvidia's revenue to grow by 71% this year to $369 billion, with a 29% growth forecast for next year, and CEO Jensen Huang's insights suggest this growth rate may be underestimated, further underscoring the company's investment appeal.
- Sustained AI Investment: Despite overall negative market sentiment, Nvidia remains a direct beneficiary of ongoing data center build-outs, indicating that the company will maintain its competitive edge in the market moving forward.
See More
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- AI Stock Potential: Nvidia commands about 90% of the GPU market share and is expected to reach $1 trillion in data center sales by 2027, showcasing its strong leadership in AI, which attracts younger investors' attention.
- Rising Capital Expenditures: Tech giants like Meta, Alphabet, and Microsoft are set to spend $650 billion on capital expenditures in 2026, indicating a surge in investment in AI data centers, further fueling young investors' interest in related stocks.
See More
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- Chip Launch: Arm unveiled its first internal AGI CPU chip in San Francisco, specifically designed for AI inference in data centers, with an expected annual revenue of $15 billion by 2031, showcasing the company's strong competitive position in the rapidly growing AI market.
- Customer Base Expansion: Major clients such as Meta, OpenAI, Cloudflare, and SAP are among the first users of the new chip, indicating strong market demand for Arm's latest product and reflecting the company's strategic positioning in the AI sector.
- Significant Revenue Projections: Arm anticipates total annual revenue reaching $25 billion by 2031, a sixfold increase from $4 billion in 2025, with CEO Rene Haas stating that this forecast will drive earnings per share to $9, significantly boosting investor confidence.
- Positive Market Reaction: Arm's stock rose approximately 13.2% in premarket trading, with analysts calling the announcement the most significant shift in the company's history, projecting $7.5 billion in incremental gross profit and $5 billion in operating profit, further solidifying its market position.
See More
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- Surge in AI Hardware Demand: Companies like Nvidia, AMD, and Micron are pivotal suppliers in AI data center hardware, with current demand outstripping supply, driving their revenues and stock prices higher, indicating robust growth potential in the AI sector.
- Significant ETF Returns: The iShares Semiconductor ETF has achieved a compound annual return of 12.8% since its inception in 2001, with an accelerated annualized return of 30.1% over the past decade, demonstrating the semiconductor industry's growth fueled by cloud computing and AI demand, promising substantial returns for investors.
- Investment Growth Potential: Investing $250,000 in the iShares ETF could yield $1 million in under 6 years at a 30.1% annual return, showcasing the ETF's strong growth potential driven by AI hardware demand.
- Future Spending Expectations: Nvidia's CEO predicts that data center operators could spend up to $4 trillion annually on infrastructure by 2030, which, if realized, would further propel investments and growth in the semiconductor industry, ensuring the ETF's long-term return potential.
See More
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- Chip Launch: Arm unveiled its first in-house chip, the AGI CPU, in San Francisco, projecting $15 billion in revenue by 2031, showcasing the company's strong potential in the AI inference market and solidifying its position in the semiconductor industry.
- Revenue Expectations Surge: Arm anticipates total annual revenue of $25 billion, a sixfold increase from $4 billion in 2025, demonstrating the company's competitiveness and profitability in the rapidly growing AI market.
- Positive Market Reaction: Following the chip announcement, Arm's stock rose approximately 13.2% in premarket trading, reflecting investor optimism about the company's future growth prospects, despite a 1.5% decline on Tuesday.
- Expanded Customer Base: Meta is the first official customer for Arm's new chip, with Arm's cloud AI head noting a $1 trillion market size, indicating that the chip will attract more customers opting for its solutions over in-house alternatives, thereby expanding the company's market share and profit opportunities.
See More
Nvidia Shares Climb: Implications of Arm's Initial AI Chip for the Market Leader.
- Nvidia's Stock Performance: Nvidia shares experienced an increase early on Wednesday.
- Market Competition: The rise in Nvidia's stock occurred despite Arm Holdings entering the artificial intelligence processor market.
See More
