SK chief predicts 2027 as AI market turning point

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SK chief predicts 2027 as AI market turning point

Published: 03 Nov. 2024, 19:20 Updated: 03 Nov. 2024, 19:29

SHIN HA-NEE
[email protected]

Audio report: written by reporters, read by AI

SK Group Chairman Chey Tae-won speaks during the 2024 SK Group CEO Seminar held in Icheon, Gyeonggi, on Saturday. [SK GROUP]

SK chief Chey Tae-won predicted the turning point for the global AI market’s expansion to come around 2027, calling to expedite ongoing group-wide efforts to streamline its business portfolio to better accommodate the rapidly changing market environment.

“There is a high possibility for a major market expansion of the AI industry to come around 2027 with the emergence of the next-generation ChatGPT,” said the SK Group chairman on Saturday during his closing remarks for the 2024 SK Group CEO Seminar, a senior-level conference attended by some 30 chief executives at SK affiliates.

“In order for SK to seize the opportunity at the right timing, we need to speedily complete the ongoing ‘operation improvement,’” stressed Chey.

The conference took place in Icheon, Gyeonggi, for three days from Thursday.

SK Group has been ramping up its efforts for the so-called operation improvement, aimed at “not only merely cutting down costs and boosting efficiency, but securing a fundamental competitiveness,” according to Chey.

As part of its rebalancing efforts, SK has been streamlining its business portfolio and plans to reduce the number of its affiliates from last year’s 219 by more than 10 percent by the end of this year through mergers and sell-offs.

Meanwhile, the conglomerate’s combined net debt, which stood at 85.5 trillion won ($61.8 billion) in the first quarter of this year, has declined to 76.2 trillion won by the end of the third quarter.

The chairman also highlighted the significance of incorporating AI in improving the group’s competitiveness and outlined the conglomerate’s future vision for AI expansion.

“By building the cheapest and best AI data centers using the group’s internal capabilities and partnerships among SK subsidiaries or with external companies, we should scale up the group’s AI business to a global level,” said Chey.

During the seminar, SK hynix CEO Kwak Noh-jung took to the stage to discuss the chipmaker’s recent strides driven by robust growth in its AI chip business, as the company posted a record 7 trillion won in operating profit for the third quarter.

“The growth in earnings this year was not merely a result of the industry-wide rebound in chip demand,” said Kwak, citing the company’s bold move to allocate a production line in Cheongju, North Chungcheong, for high bandwidth memory (HBM) chips, and a data-driven decision-making process for its latest advances.

BY SHIN HA-NEE [[email protected]]