YMTC (Yangzi Memory TechnologiesIt is growing like wildfire in China. According to consulting firm Omdia, this NAND chip maker will reach a market share of 38.5% in its home country in the second quarter of 2026. By 2025 its share was around 28%, reflecting An upward trend very marked However, Samsung and SK Hynix, the companies that lead the global NAND flash semiconductor market, are bleeding in China.
Samsung’s share in China dropped to 33.5% in the second quarter of this year. and SK hynix 17%. YMTC already sells more NAND flash chips in China than Samsung and SK hynix. And this market is too big and too important to ignore this trend. In fact, these two South Korean companies are planning to modernize their Chinese factories to compete with YMTC, which has already caught up with them from a strictly technological standpoint.
The latter semiconductor manufacturer primarily produces 160- and 232-layer NAND chips, but also a small number of 294-layer chips. And it plans to cross the 300 level in the medium term. Increasing the number of layers in these semiconductors is important because it allows more information to be stored in the same space, as well as reducing the cost per bit. Samsung and SK Hynix, which have plants in China, no longer have the ability to compete head-to-head with YMTC.
Samsung and SK Hynix have problems with US sanctions
Samsung’s plant in Xi’an, northwest China, accounts for about 40% of its global NAND chip production capacity. It currently manufactures about 200 layers of integrated circuits, and Samsung officials plan to modernize these facilities to enable production of 286-layer V9 NAND chips. Furthermore, according to Reuters, this modernization project aims to increase production capacity to 40,000 wafers per month by December 2027.
For Samsung and SK hynix, the only way to compete with YMTC in China and stop their progress in the global market is to modernize their factories in this country.
SK Hynix is in the same position as Samsung in China. Its factory in Dalian, in the northeast of the country, produces 192-layer NAND integrated circuits, and it aims to upgrade these facilities to start producing 240-layer chips, and later, More than 300 levels. For Samsung and SK hynix, the only way to compete with YMTC in China and stop their progress in the global market is to modernize their factories in this country. And they don’t make it easy.
The US government’s ban on exports of advanced semiconductor manufacturing equipment to China is a hurdle for Samsung and SK Hynix. To increase the number of layers of their NAND flash chips, they must install more advanced lithography machines at their Xian and Dalian plants, as well as install cutting-edge wafer processing and etching equipment. And American sanctions make it difficult to launch these machines in China, forcing both companies to obtain the necessary licenses.
This complex scenario creates a very interesting paradox. The US is slowing down the development of the Chinese semiconductor industry, and because of this it is blocking the most advanced equipment. Use US patents Arrive in China. Additionally, it wants to contain YMTC’s progress in the global market, but, and here comes the paradox, its sanctions on China prevent Samsung and SK Hynix from modernizing their plants in the latter country. And if they don’t adequately equip their factories in Xi’an and Dalian, they will continue to lose competition against YMTC which is getting stronger every day. We will see what the final outcome of this conflict is.
Picture | SK Hynix
More information Reuters
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