Changxin Memory (CXMT) is expanding its presence in the global general DRAM market, closely trailing behind Samsung Electronics and SK Hynix. As the two South Korean semiconductor giants focus on high-value production such as high-bandwidth memory (HBM), CXMT is seizing the opportunity to penetrate the general DRAM supply gap.
According to market research firm TechInsights on September 28, CXMT's global DRAM market share is projected to soar to 18% next year. This follows a significant rise to 10% in the second quarter of this year, marking an 18-fold increase from just 1% in 2023. This positions CXMT as the fourth largest DRAM manufacturer globally, a notable achievement given the strong memory oligopoly established by Samsung (38%), SK Hynix (25%), and Micron (24%). It is rare for a Chinese company to capture a double-digit market share in this sector.
Key drivers of CXMT's growth include aggressive pricing strategies supported by government subsidies and rapid production capacity expansion. Since its inception, CXMT has received substantial funding from the Hefei local government and a national semiconductor investment fund totaling $47.7 billion. The Chinese government has also implemented extensive support measures, including direct subsidies to domestic IT companies purchasing Chinese chips and preferential treatment in public procurement.
Leveraging prices that are 20-30% lower than global market rates, CXMT has established a solid order base by supplying DDR5 and low-power DRAM for mobile devices to major companies like Alibaba, ByteDance, Tencent, and Xiaomi. It has also successfully entered the global supply chain, passing quality checks for budget laptop lines launched by global PC manufacturers such as HP and Acer in emerging markets outside the U.S.
The strategic calculations of Samsung and SK Hynix have become increasingly complex as they focus on advanced process transitions. Thanks to stable demand and yield stabilization for fifth-generation (HBM3E) and sixth-generation (HBM4) HBM, the overall operating profit margin for their DRAM businesses remains between 50% and 60%. However, with primary wafer production capacity allocated to high-value AI memory, the supply capacity for general server and consumer DRAM has been relatively reduced.
Kim Yang-pyung, a senior researcher at the Korea Institute for Industrial Economics and Trade, stated, "CXMT's rapid growth signifies a structural change in the general memory market beyond mere volume expansion. Domestic companies need to ensure they do not lose pricing power in the general market while focusing on high-value AI memory, necessitating a comprehensive response to strengthen profit resilience across their operations."
* This article has been translated by AI.
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