Thought Leadership
Memory manufacturer YMTC has announced ahead of its planned initial public offering that it aims to overtake Samsung and SK Hynix to become the world’s largest NAND flash producer.
According to figures from market research firm Counterpoint Research, YMTC reached a global NAND market share of around 14 percent in the second quarter, tied with Kioxia, while market leader Samsung accounted for about 25 percent and SK Hynix, along with its subsidiary Solidigm, reached a combined total of around 22 percent. To achieve its goal, YMTC would need to nearly double its market share within 16 months. Analysts currently rank the company globally as number three in terms of both revenue and sales volume, while in China, YMTC already holds first place.
YMTC has only been continuously profitable since 2024 and reported first-quarter revenue of 47.04 billion yuan and a net profit of 33.38 billion yuan, more than double its total net profit for the entire year of 2025. Gross margin rose from 5.45 percent in 2023 to 35.3 percent in 2025, reaching 76.77 percent in the first quarter of 2026, with a fab utilization rate of 98.02 percent. For this expansion, the company has invested 96.39 billion yuan in property, plant, and equipment as well as 15.95 billion yuan in research and development to date.
Proceeds primarily directed toward production expansion and research
For its IPO, YMTC plans to issue 1.98 to 2.43 billion A-shares, corresponding to 10 to 12 percent of post-IPO capital, underwritten by investment banks CITIC Securities and CSC Financial. Out of the proceeds, 20.8 billion yuan is to flow into expanding mass production and 12.2 billion yuan into advanced research and development, which would correspond to a post-IPO company valuation of 275 to 330 billion yuan.
The IPO follows the pattern already set by ChangXin Memory Technologies (CXMT), China’s leading DRAM manufacturer, which recorded Asia’s largest IPO of the year in July at $8.6 billion and gained 466 percent on its first day of trading. Joanna Yang, portfolio manager at investment firm Ninety One, expressed concerns to the Financial Times regarding the potential market consequences of this expansion.
“For global investors, the question arises as to how the capacity expansion of these Chinese companies will affect supply and demand for memory chips.”
Joanna Yang, Portfolio Manager at investment firm Ninety One
Competitive despite US sanctions
YMTC has been on the US Department of Commerce’s Entity List since December 2022, cutting it off from access to advanced American manufacturing tools. Unlike logic chips, where sanctions effectively block access to cutting-edge lithography technology, competitiveness in NAND memory depends primarily on the number of stacked memory layers and the stacking and bonding technology used, which does not require state-of-the-art EUV lithography. YMTC’s current fifth NAND generation connects two memory blocks of 150 and 144 layers into a 294-layer component via its proprietary Xtacking architecture, for which the company increasingly relies on domestically developed manufacturing tools to close remaining technological dependencies.
(Editorial Team)
