China’s memory chipmakers challenge South Korean dominance with rapid capacity expansion

Chinese firms Yangtze Memory Technologies Co. and ChangXin Memory Technologies are accelerating their push into the global memory market, expanding capacity and market share at a pace that threatens South Korea’s longstanding semiconductor dominance.

Chinese memory chipmakers are accelerating their challenge to South Korea’s dominance in semiconductors, with Yangtze Memory Technologies Co. and ChangXin Memory Technologies both expanding capacity and market share at a pace that is starting to reshape the sector. According to market researcher Omdia, YMTC is expected to lift NAND wafer output by roughly a quarter next year, while CXMT has already moved into fourth place globally in DRAM, narrowing the gap with the industry leaders.

YMTC’s rise has been especially sharp. Omdia said the company climbed to third place in the global NAND market on second-quarter shipment volume, and its output is expected to rise further as its Wuhan Phase 3 plant begins operations by the end of this year. Industry reports also suggest the company is planning additional fabs in Wuhan, a move that would more than double its current wafer capacity and deepen its push towards scale.

CXMT is following a similar pattern in DRAM. Omdia data shows its global market share rose from 4.7% in the fourth quarter of last year to 7.6% in the first quarter of this year, putting it behind Samsung Electronics, SK hynix and Micron but well ahead of many peers. The company has also raised substantial funds through an initial public offering, giving it capital to upgrade production lines and invest in next-generation DRAM research.

By contrast, South Korean makers are largely holding their NAND output steady. Omdia expects Samsung Electronics and SK hynix to post only modest wafer growth next year, as both groups concentrate investment on higher-margin products such as high-bandwidth memory, server DRAM and enterprise SSDs. That strategy reflects the strongest near-term demand in AI data centres, where performance and reliability matter more than commodity pricing.

The technological gap is still most visible in AI memory. Samsung and SK hynix are moving into HBM4 production and developing HBM4E, while CXMT is still working to stabilise HBM3-class manufacturing, according to industry assessments. Analysts say the barriers are not only process complexity but also the need for customer qualification, thermal control and large-scale production experience, all of which favour incumbents with established global supply chains.

Even so, the longer-term competitive risk is clear. China’s domestic market gives local producers a captive base for volume, learning and cash flow, which can then be recycled into more advanced products. YMTC has said it wants to become the world’s largest NAND maker by the end of 2027, while reports on CXMT indicate it could materially expand its share of China’s DRAM and HBM demand by 2028 if current investment plans are completed.