SK Hynix Is in Talks With Intel to Make Memory Chips in the U.S. Here's What It Could Mean for Intel Stock.

SK Hynix (NASDAQ:SKHY) is in talks with Intel (NASDAQ:INTC) about making memory chips in the U.S. for the first time, Reuters reported on Wednesday. One option would have the South Korean memory specialist lease part of Intel's chipmaking campus in Ohio. Another would create a joint venture with Intel and major cloud companies that want a steady supply of memory.

As of this writing, Intel's stock is up about 5% for the day, trading above $100.

The enthusiasm is understandable. Intel's Ohio campus is enormous and years behind schedule -- and what it has been missing is enough demand.

SK Hynix, however, cautions that nothing has been decided. Intel isn't even confirming the talks.

Image source: Intel.

The reported talks

The discussions are exploratory, according to the report, with no decisions on a deal's structure or on which memory chips would be produced. SK Hynix said in a statement Wednesday that it is "exploring various options to strengthen its global competitiveness, but no specific plans or arrangements have been finalized at this time."

Intel declined to comment on the talks, while saying it remains committed to preparing its Ohio site.

Still, the pairing makes sense. SK Hynix is the leading maker of high-bandwidth memory, the memory that artificial intelligence accelerators depend on.

And while the memory specialist broke ground on its first U.S. facility last month (a $4 billion plant in Indiana), that plant will package and test chips -- not make them.

The two companies also have history. Intel sold its NAND memory business to SK Hynix in a $9 billion deal. An agreement in Ohio would put the buyer of Intel's old memory business back inside an Intel campus.

Ohio has been waiting on demand

When Intel first announced its Ohio project, production was supposed to begin in 2025. The schedule has moved in only one direction since.

In February 2025, the company said construction of the site's first chip factory wouldn't finish until 2030, with operations starting between 2030 and 2031. And Intel has said the site could eventually represent as much as $100 billion of investment.

The slow pace is deliberate. Intel operations chief Naga Chandrasekaran said at the time of the delay that "it's important that we align the start of production of our fabs with the needs of our business and broader market demand." Intel, in other words, doesn't want to finish factories it can't fill.

That caution reflects where Intel's foundry, the company's contract-manufacturing business, stands today. The unit booked $5.8 billion of revenue in the second quarter, up 31% year over year, but only $293 million of it came from customers other than Intel. The foundry's operating losses are narrowing, from $3.2 billion in the second quarter of 2025 to $2.4 billion in this year's first quarter to $2.1 billion in its second. That still leaves a business losing about $2 billion every three months.

A memory tenant or a venture could help in two ways. Lease payments or venture revenue would put money against a site that today is all cost. And a committed occupant could give Intel a reason to speed construction back up.

What could it mean for Intel stock?

In the near term, I think the report changes less than Wednesday's pop suggests. The talks could fall apart, and the reported scenarios leave the biggest questions open: which chips, whose capital, and on what timeline. In South Korea, meanwhile, the trade ministry has said a deal could face review under a technology-protection law if national core technologies are involved.

There's also the stock's price. Intel is growing again. Second-quarter revenue climbed 25% from a year earlier, to $16.1 billion, and non-GAAP (adjusted) earnings per share swung to a $0.42 profit from a $0.10 loss.

But shares have climbed from a 52-week low of $24.45 to about $101, and they now cost about 49 times the earnings analysts forecast for next year. That price already assumes Intel's data center momentum continues and its foundry wins outside customers.

So, what could the talks mean for Intel stock? A finished deal could mean a lot. A committed memory partner would put revenue, and possibly outside capital, into a planned $28 billion campus that today only consumes cash -- and give Intel the best evidence yet that the Ohio site can attract meaningful outside commitments.

Ultimately, though, talks aren't contracts. Neither company is promising anything, and Ohio's history shows how long Intel is willing to wait for demand it can count on.

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Intel. The Motley Fool has a disclosure policy.