Samsung, SK Hynix Sink on CXMT DRAM Tease

Samsung Electronics and SK Hynix, the leading semiconductor firms in the memory market, witnessed a significant drop in their stock prices following the announcement by ChangXin Memory Technologies (CXMT), a Chinese company, of a new 4F² technology. This technology promises to store more data in the same memory space by reducing the memory cell area by 33% compared to the current 6F² method. The news sent shockwaves through the market, with Samsung Electronics' stock falling by 7.39% and SK Hynix's by 10.09% on October 13.

CXMT's announcement came at a time when memory prices had surged due to the increasing demand for artificial intelligence (AI) applications. The Chinese company seized this opportunity as a chance to challenge the established players. Although the production costs for Chinese firms are currently higher than those in South Korea, the overall rise in market prices has made it possible for them to generate profits despite the higher costs.

Analysts suggest that CXMT's move may be an overhyped marketing strategy, as they have not disclosed specific details about the product or its release timeline.

The United States' export restrictions on China have further limited CXMT's ability to maximize the mass production efficiency of their new technology. This is primarily because CXMT would need to secure ASML's extreme ultraviolet (EUV) lithography equipment, which is crucial for improving semiconductor yields. Despite these challenges, it is clear that China's rapid advancements in semiconductor research and development (R&D) capabilities are closing the gap with South Korea.

Ahn Ki-hyun, a senior executive director at the Korea Semiconductor Industry Association, emphasized the urgent need to accelerate technological development to maintain the top position in the market. He proposed measures such as an exception to the 52-hour workweek for semiconductor research positions to support skilled research personnel in producing results more intensively.