China’s CXMT prepares flash memory push to rival Samsung

Chinese chipmaker CXMT is preparing to enter the flash memory chip market, Reuters reported on Friday, a move that would pit the DRAM specialist against Samsung Electronics and domestic rival YMTC in one of the semiconductor industry's fastest-growing segments.reuters

ChangXin Memory Technologies (688825.SS) plans to establish a research-and-development production line for NAND flash memory at its new plant in Beijing, according to three people familiar with the matter cited by Reuters. The company has also set up a research institute in the Chinese capital where projects include NAND development.reuters

A Shortage-Driven Opportunity

The expansion comes as strong demand from artificial intelligence servers has created a global memory shortage that industry executives believe will persist through at least 2027. SK Hynix ↗ 2.78% CEO Kwak Noh-jung said in July that 2027 could be the industry's worst year from a supply perspective, while research firm TrendForce expects NAND supply tightness to ease only in the second half of next year.devdiscourse+1

Major memory chip makers have increasingly prioritized capital spending on DRAM and high-bandwidth memory, or HBM, limiting additions to NAND flash capacity and worsening shortages in that segment, according to TrendForce. Samsung was the world's biggest NAND supplier by revenue in the second quarter with a 29.3% share, followed by SK Hynix and Micron Technology ↗ 5.12%.reuters

CXMT has discussed its NAND plans with customers, including a newly established startup that intends to buy its NAND chips for storage products used in AI systems and supercomputers, Reuters reported, though the startup was not identified.reuters

China's 'Twin Stars' Cross Paths

CXMT and YMTC, known in China as the "twin stars" of the country's memory-chip industry, have largely operated in separate markets — CXMT in DRAM and YMTC in NAND. Those lines have begun to blur. In April, Reuters reported that YMTC had sent low-power DRAM samples to customers as it weighed entry into CXMT's core market.reuters

Both companies have emerged as key pillars of Beijing's drive to build a self-sufficient chip industry. CXMT raised 57.92 billion yuan ($8.6 billion) in July in Asia's biggest initial public offering this year and plans a second memory-chip plant in Beijing. Washington's export restrictions, including placing YMTC on its Entity List in 2022 and tightening China's access to HBM chips, have added urgency to China's push to develop domestic memory suppliers.thenews+1

It was not clear when the R&D production line would start operating or whether CXMT intends to move from trial production to large-scale commercial manufacturing.reuters