Reuters: Samsung, SK Hynix Upgrade Chinese Plants to Counter YMTC Competition

October 21 - According to Reuters, Samsung Electronics and SK Hynix are upgrading their Chinese factories to produce NAND flash memory chips with higher layer counts, in response to the rapid development of Chinese competitor Yangtze Memory Technologies and to meet growing storage demand in the AI sector. Both companies confirmed to Reuters that relevant upgrades are underway and stated that they are maintaining close communication with the U.S. side regarding the work, but did not disclose specific production plans.

Samsung plans to upgrade its factory in Xi'an, China, to produce 286-layer V9 NAND flash chips. The factory currently mainly produces chips of about 200 layers, accounting for approximately 40% of Samsung's global NAND output. According to people familiar with the matter, Samsung internally calls this project "Monami," with the goal of achieving a monthly output of 5,000 wafers by December 2026 and increasing monthly output to 40,000 wafers by December 2027.

Samsung stated that the upgrade is aimed at meeting the needs of global customers, including U.S. customers, and does not involve expanding capacity or building new manufacturing facilities. SK Hynix plans to upgrade its factory in Dalian, China, to produce NAND products of 240 layers and above; the factory currently produces products of about 192 layers. According to people familiar with the matter, the company has been approved to produce chips of up to 240 layers in Dalian and may apply to the U.S. government to conduct research and development of chips of 300 layers and above locally, laying the foundation for future production of related products in the United States.

SK Hynix is also discussing plans to build a new NAND factory in the United States with the Trump administration. The report noted that the United States has imposed export controls on certain chip manufacturing equipment since 2022, and Samsung and SK Hynix need to apply for licenses annually to install U.S.-made equipment in their Chinese factories. The U.S. Bureau of Industry and Security (BIS) previously stated that it plans to allow the two companies to continue operating their existing Chinese factories but does not intend to approve applications to expand capacity or upgrade technology. Reuters has not been able to confirm the extent to which the two companies have obtained approval for the equipment export licenses required for these upgrades.

Meanwhile, Yangtze Memory Technologies' share of the Chinese NAND market continues to rise. Data from research firm Omdia shows that Yangtze Memory Technologies' share of the Chinese NAND market reached 38.5% in the second quarter of 2026, up from 28% for all of 2025, and surpassing Samsung. During the same period, Samsung's market share fell from 36% to 33.5%, while SK Hynix's fell from 20% to 17%. Yangtze Memory Technologies currently mainly produces 160-layer and 232-layer products, has also produced 294-layer chips in small quantities, and plans to launch products with more than 300 layers. Currently, Samsung sells NAND chips of up to 286 layers in markets outside China and showcased prototype products with more than 400 layers in August this year; SK Hynix sells NAND chips of up to 321 layers.