"Samsung and SK Hynix Are Upgrading Their China Plants to 286-Layer NAND — With Washington's Blessing"

The U.S. export-control regime on China was supposed to slow China's chip progress. This week it may have just done the opposite — for Korea.

Samsung Electronics and SK Hynix are upgrading their Chinese factories to produce far more advanced memory chips, according to Reuters, which cites four people familiar with the plans. Samsung's Xi'an plant — about 40% of the company's global NAND output — is being converted from roughly 200-layer chips to 286-layer V9 NAND under a project internally dubbed "Monami," French for "my friend." Target: 5,000 wafers a month this December, scaling to 40,000 by December 2027. SK Hynix is moving its Dalian facility from 192 layers to 240 or more.

The unspoken driver is Yangtze Memory Technologies, China's homegrown NAND champion. YMTC took 38.5% of China's NAND market in Q2, per Omdia — up from 28% for all of 2025 and now ahead of Samsung, which has slipped to 33.5%. SK Hynix is down to 17%. And YMTC is closing the technology gap: mostly 160- and 232-layer chips today, but a small amount of 294-layer product already in production, with 300-plus planned.

Here's the part that matters. Both companies confirmed the upgrades to Reuters and said they're being done "in close consultation with Washington." Yet the U.S. Bureau of Industry and Security said in 2025 it did not intend to grant licenses to upgrade technology or expand capacity at foreign chipmakers' China factories — and when Reuters asked, BIS declined to say how much licensing it has actually granted. So either the controls have quietly loosened for allies, or Washington decided that letting Samsung and SK Hynix modernize inside China beats watching YMTC take the market outright.

Samsung framed it as demand-driven: "The upgrade is aimed at meeting growing demand from global customers, including those in the US. The company is not expanding production capacity or constructing new manufacturing facilities." More layers, same footprint — a density play.

Investors read it as good news: both stocks closed about 6% higher in Seoul on Wednesday, according to TipRanks. And SK Hynix is playing two continents at once — it may seek Washington's permission to do 300-plus-layer R&D at Dalian while also discussing a new U.S. NAND factory with the Trump administration.

Bottom line: if Washington ever meant to hold these plants at 2022 technology, that moment has passed. AI data-center storage is the tail wagging this dog, and YMTC's market share is why Washington is bending.

— via Reuters