CXMT's stellar IPO debut in Shanghai, despite its significant success, will not change the outlook for the global memory market. CXMT plans to expand into HBM production but faces challenges due to the absence of EUV lithography:
The leading memory manufacturer in China, seeking to raise up to $9.8 billion in an initial public offering, is supported by strong domestic demand. The nearly 466% surge in CXMT's shares on its first trading day has raised hopes that Beijing's long-term efforts to build a self-sufficient semiconductor industry are beginning to pay off:
However, the question remains whether CXMT can close the technology gap with Samsung Electronics, SK Hynix, and Micron, especially in high-bandwidth memory (HBM), where the three companies have established a significant lead:
Analysts note that while domestic demand should continue to support CXMT's memory chips, the company faces challenges as it does not have access to the latest extreme ultraviolet (EUV) lithography machines, which are essential for manufacturing advanced chips:
CXMT is targeting to produce HBM from the end of 2026, with the new Shanghai fab geared to produce AI chips:
Samsung Electronics maintains its lead in the global DRAM market with a 38% market share, while CXMT's share stands at 8%:
CXMT currently supplies memory chips to many Chinese smartphone brands and is gradually expanding its presence in China's PC and server markets:
Shares of CXMT were up over 5% in Friday trading:
