CXMT Secured a Large Deal with Tencent for $3 Billion

Chinese DRAM maker ChangXin Memory Technologies (CXMT) has quietly locked in a major supply agreement with Tencent Holdings for a value around 20 billion yuan, or roughly $2.94 billion, and covers several years of DRAM chip supply for servers.We learnt also that others “big deals” are under active talks with other Chinese IT and internet companies. Reading the IPO prospectus, we see also Alibaba Cloud, ByteDance, Xiami or Lenovo.

With the CXMT IPO coming with recent Shanghai Stock Exchange approval, it illustrates the momentum around the company and confirms its growing role in the domain and for China footprint on the memory industry against usual leaders we all have in mind.

Beyond that, the memory market is expected to continue its stellar growth fueled by high demands everywhere. It should pass the $ Trillion barrier in 2027. CXMT is ranked #4 in DRAM segment with 700% YoY growth with Yuan 50.8 billion for the 1st quarter.

The company accelerates also on the manufacturing footprint and beyond its existing Shanghai facility dedicated to HBM packaging, a DRAM zone has been secured in Shanghai as well in addition to their Beijing and Hefei, China, locations. These 2 production sites appear to have a combined capacity of about 300,000 wafers per month and should double with new coming ones. There is still room to grow on the technology aspect when we compare with Samsung or SK hynix.

Once again, this is a strategic move for China as they well understand the need to feed first their domestic players and economy icons.