SK hynix, the world's second-largest memory chip maker, on Tuesday unveiled its next-generation GDDR7 graphics memory chip that boasts the industry’s most outstanding performance in terms of operating speed and power efficiency.

The company said it will start mass production in the third quarter.

GDDR is a type of high-performance memory commonly used in graphics cards. It has recently gained popularity as graphics cards are increasingly used to power artificial intelligence workloads.

The memory chip maker introduced its new chip prototype at GTC 2024, a developer conference hosted by US chip giant Nvidia, in March, and Computex 2024, Asia’s largest IT exhibition in Taiwan, in June.

SK hynix said its product can be operated at 32 gigabits per second, a 60 percent improvement from the previous generation. It can reach up to 40 gigabits per second depending on the circumstances.

When adopted for high-end graphics cards, the new chip can process data of more than 1.5 terabytes, equivalent to 300 full-HD movies, in a second.

It also improved power efficiency by more than 50 percent compared with the previous generation by adopting the new packaging technology that addresses heat issues caused by ultra-fast data processing.

In a bid to reduce thermal resistance by 74 percent compared with the previous generation, while maintaining the size of the product, SK hynix said it increased the layer number of the heat-dissipating substrates from four to six.

It also applied the epoxy molding compound, an essential material for semiconductor packaging that protects chips from various external conditions, the company explained.

Lee Sang-kwon, head of the DRAM product planning division at SK hynix, said that GDDR7 is expected to be have a wider range of applications, such as high-specification 3D graphics, AI, high-performance computing and autonomous driving.

"We will continue to work towards enhancing our position as the most trusted AI memory solution provider by strengthening the premium memory lineup further," Lee said.

Along with SK hynix, its archrival Samsung Electronics and US-based Micron Technology are fiercely competing in the graphics DRAM market following the burgeoning high-bandwidth memory market.

Samsung Electronics developed the industry's first 32 gigabits per second GDDR7 DRAM a year ago. The world’s largest memory chip maker is preparing for mass production in the second half of this year.

Micron introduced its GDDR7 at Computex 2024. It explained that its chip boasts an operating speed of 32 gigabits per second. It also has a 60 percent increase in bandwidth and a 50 percent improvement in power efficiency compared to the previous generation.

According to market researcher TrendForce, GDDR7 is emerging as the next-generation flagship product in the graphics memory market.

“On the supply side, new GPUs entering the validation stage will lead to increased GDDR7 production. Currently, GDDR7 carries a 20-30 percent premium over GDDR6. As samples ship in the third quarter of 2024, this will slightly push up the average sales price,” the report read.