China's YMTC has entered the top three flash memory suppliers for the first time, surpassing Micron and Kioxia

China’s Yangtze Memory Technologies (YMTC) has broken into the top three flash memory suppliers, though so far only in terms of physical shipment volume, according to the South China Morning Post, citing data from Counterpoint Research. However, in terms of revenue, the Wuhan-based company remains in fifth place: it lags behind its competitors in the high-end segment of solid-state drives for data centers.

In the second quarter, YMTC accounted for 14% of global NAND flash memory shipments by capacity. According to Counterpoint, the Chinese manufacturer outperformed market leaders such as the U.S.-based Micron and Japan’s Kioxia in this metric. Shipments grew by 22% year-over-year and 5% quarter-over-quarter, driven by increased shipments to local electronics manufacturers and a ramp-up in production of the latest-generation NAND.

The difference between YMTC’s rankings in terms of volume and revenue is due to its product mix. The company primarily focuses on less profitable consumer products, while its presence in the enterprise SSD segment—where products sell at higher prices—remains limited, according to the South China Morning Post.

Samsung Electronics retained the top spot with a 25% market share, while SK Hynix and its subsidiary Solidigm tied for second place, with a combined market share of 22%.

In the second quarter, enterprise SSDs accounted for 48% of the total global NAND flash memory capacity shipped—nearly double the figure from a year earlier. By the end of the year, that share could exceed 50%.

Counterpoint attributes the surge to the industry's shift from training AI models to deploying them: processing frequently used datasets requires large amounts of high-speed memory, the article states.

YMTC is increasing production at its second factory in Wuhan and continues to build and equip its third factory. The U.S. investment bank Morgan Stanley expects the Chinese chipmaker’s capacity expansion to accelerate in 2027 and 2028.

YMTC is preparing for a stock offering in mainland China following rival CXMT’s high-profile Hong Kong debut last month. CXMT is already the world’s fourth-largest memory manufacturer. According to Reuters, in July it signed a five-year contract worth more than $7 billion with TikTok’s owner, ByteDance.

Until recently, memory was considered a low-margin commodity: YMTC and CXMT survived for years on government funding and operated at a loss until the construction of AI data centers turned these components into some of the most in-demand products in the world. Now, Chinese manufacturers are selecting their own customers and setting prices, and sometimes even demanding higher prices than South Korea’s Samsung and SK Hynix, as soaring demand is forcing buyers in China to accept increasingly higher price tags, according to Reuters sources.

The growing strength of Chinese competitors is prompting a pushback from Micron. The American company is calling on the U.S. Congress to tighten restrictions against YMTC and CXMT, including limiting their access to chip-making equipment.

This article was AI-translated and verified by a human editor