February 3, 2026
SEOUL – Long dismissed as years behind its global rivals, China’s memory-chip industry is advancing faster than expected, unsettling competitors in South Korea and the US.
Massive state backing and a looming initial public offering by China’s top DRAM maker have raised fresh questions over how quickly the country’s longtime chip underdog is catching up.
Yet despite the growing unease, industry experts say Korea’s dominance in memory chips remains firmly intact — underpinned by superior manufacturing know-how, higher yields and a widening lead in AI-critical memory technologies that are proving difficult to replicate.
The global memory market continues to be dominated by Samsung Electronics and SK hynix, alongside US-based Micron Technology. Together, the three account for more than 90 percent of the global DRAM market.
Their strength lies not only in scale but in leadership across the most technologically demanding segments — advanced DRAM and high-bandwidth memory (HBM), which are essential for artificial intelligence computing. Decades of mass-production experience, deep ties with global customers and the ability to scale increasingly complex processes at commercial yields have allowed the industry leaders to maintain their positions for years.
Korean chipmakers were the first to commercialize DDR5 memory in 2020 and are already shipping fifth-generation HBM3E chips to major AI customers this year. They are also preparing to supply next-generation HBM4 products, further extending their lead in AI memory.
Spearheading China’s push into the memory stronghold is ChangXin Memory Technologies. Founded just over a decade ago and profitable for the first time only in 2025, the company currently holds about 4 percent of the global DRAM market.
CXMT remains several generations behind at the cutting edge of DRAM manufacturing. But backed by aggressive government policy aimed at achieving semiconductor self-sufficiency amid intensifying technology competition with the US, the company has expanded its customer base rapidly and accelerated its process development as it prepares for a potential listing in Shanghai.
According to its IPO prospectus, CXMT has moved from early-stage development to volume manufacturing in just a few years. In November, it announced mass production of DDR5 and LPDDR5X memory products — the latest DRAM standards used in PCs, servers and mobile devices.
CXMT has also set its sights on advanced AI memory, including plans to mass produce fourth-generation HBM3-class products this year. HBM involves the technically demanding vertical stacking of DRAM chips to improve performance and power efficiency — an area widely seen as the highest barrier in memory manufacturing.
South Korean experts estimate that China trails Korea’s leading chipmakers by roughly two to three years in DRAM technology — a gap that has narrowed sharply from a decade ago but remains significant in an industry where each generation brings major gains in efficiency and cost competitiveness.
The difference is most visible in process technology. In a December report, the National Academy of Engineering of Korea said leading Korean and global memory producers have moved into fifth- and sixth-generation 10-nanometer-class nodes, known as 1b and 1c, enabling higher density and better power efficiency.
Chinese firms, by contrast, were found to be operating mainly at the 1z node — an earlier generation of sub-20-nanometer DRAM technology. In practical terms, this means Korean chips can deliver higher performance at lower power and be produced more economically at scale, advantages that compound over time.
In NAND flash memory, the technology gap appears narrower. Market leaders Samsung Electronics and SK hynix are mass producing 286- to 321-layer chips, among the industry’s most advanced. Chinese manufacturers have accelerated as well, with production of 232-layer NAND chips.
While Chinese firms remain behind overall in NAND, the academy noted that hybrid bonding technology developed by Yangtze Memory Technologies is considered more advanced than that of Korean rivals — a reminder that China is making real progress, even if it is uneven.
The gap is widest in high-bandwidth memory, where Korea’s dominance remains pronounced. While CXMT has announced ambitions to enter the HBM market, Korean chipmakers are already delivering HBM3E at scale and preparing for HBM4.
HBM leadership depends less on headline process nodes than on stacking precision, thermal control and yield stability — capabilities refined through years of close collaboration with AI chip designers and customers. Industry observers say these areas represent Korea’s most defensible advantage.
CXMT’s current process technologies used for DDR5, LPDDR5 and HBM products are seen as costlier and less efficient than those of global leaders, resulting in lower yields and weaker profitability despite rapid capacity expansion.
“The technology gap with China is evident,” said Lee Jong-hwan, a professor of system semiconductor engineering at Sangmyung University. “But China’s ultimate goal is not short-term profitability. Its chip ambition is directly linked to its competition with the US, including AI and military capabilities.”
Supporting China’s drive for self-sufficiency is the state-led National Integrated Circuit Industry Investment Fund, widely known as the Big Fund, which has amassed combined capital exceeding 690 trillion yuan ($95 billion), the world’s largest semiconductor subsidy program.
Now in its third phase launched in 2024, the fund is focusing on strengthening China’s entire semiconductor supply chain — from design and manufacturing to packaging, testing and equipment — as well as strategic areas such as advanced AI chips and HBM.
Concerns have also surfaced over China’s reported efforts to develop its own extreme ultraviolet lithography tools, a critical technology for producing the world’s most advanced chips. Reuters recently reported that China has completed a prototype and aims to produce working chips by 2028, though analysts see commercial production closer to 2030.
Still, industry veterans caution that capital alone cannot overcome the steep technological barriers of advanced memory manufacturing.
“Semiconductor business is not something that can be mastered with money alone,” said Shim Dae-yong, a professor at Dong-A University who spent 26 years overseeing the DRAM business at SK hynix before leaving as a vice president in 2021.
He noted that the industry’s rapid upgrade cycles mean legacy technologies quickly lose relevance after their peak, limiting the long-term economic impact of dominance in lower-end segments.