Daijiworld Media Network - Beijing
Beijing, Jul 25: China's leading memory chip manufacturers, ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Corp (YMTC), have emerged as major players in the global semiconductor industry, leveraging soaring demand for artificial intelligence (AI) infrastructure to dictate prices, secure multi-billion-dollar deals and expand their global ambitions.
According to a Reuters report, CXMT recently refused to lower chip prices for Huawei despite repeated requests from the Chinese technology giant, signalling a significant shift in the balance of power within China's semiconductor sector. Sources familiar with the matter said executives at Huawei-linked equipment supplier SiCarrier viewed the dispute as evidence of CXMT's growing influence.
Once heavily dependent on government funding and burdened by losses, CXMT and YMTC have benefited from the rapid expansion of AI data centres, which has sharply increased demand for memory chips used in smartphones, laptops and servers.
Industry sources told Reuters that the two companies are now selecting customers and setting prices, with Chinese buyers in some cases paying more than they would for chips from South Korean rivals Samsung and SK Hynix due to supply constraints.
Earlier this month, CXMT reportedly signed a five-year supply agreement worth more than $7 billion with ByteDance, the Chinese parent company of TikTok.
The report, based on interviews with executives, engineers, suppliers and US officials, as well as a review of government policy documents and corporate filings, said the two companies—often referred to in China as the "twin stars" of the memory chip industry—are positioning themselves for major initial public offerings (IPOs).
Neither CXMT nor YMTC responded to Reuters' requests for comment regarding their pricing strategies, business plans or increasing scrutiny from the United States.
The companies have also become a focal point in the growing technology rivalry between Washington and Beijing. The US Pentagon has designated both firms as Chinese military companies, alleging links to China's military-civil fusion strategy, an accusation the companies deny. YMTC is already on the US Entity List, limiting its access to American technology and semiconductor manufacturing equipment.
US lawmakers are considering additional restrictions on both companies, although Reuters reported that the Trump administration remains divided over imposing further curbs. According to sources, Apple has sought assurances that CXMT will not be added to the Entity List, while Micron has urged US lawmakers to tighten restrictions on the Chinese firms. Apple, Micron, the White House and the US Departments of Commerce, Defense and State declined to comment.
Despite geopolitical tensions, CXMT is set to make its debut on the Shanghai stock market on Monday following an $8.6 billion IPO. The company reported first-quarter revenue of $7.5 billion, a 719 per cent increase compared to the same period last year, reversing years of financial losses.
YMTC is also preparing for an IPO, with some executives reportedly targeting a valuation of 1 trillion yuan ($148 billion).
The two companies are expanding beyond the Chinese market. YMTC entered South Korea in June with its consumer memory storage products, while CXMT is aiming to enter the US market in the longer term. Chinese authorities have reportedly instructed both firms to prioritise domestic customers, although planned manufacturing expansion is expected to enable them to supply both domestic and international markets from 2027 onwards.