MU And SNDK's Nascent Rebound Faces A New Test — China's CXMT Reportedly Makes Major Breakthrough With New AI Memory Chip

• China’s CXMT plans to expand HBM3E production in 2027, with Alibaba’s T-Head and Cambricon already testing the chips, according to The Information.
• Micron and SanDisk rebounded sharply last month after July’s selloff.
• Despite growing China risks, 82% of Stocktwits poll respondents expect the memory rally to continue into September.

China’s rapid advances in memory technology are emerging as a potential risk for Micron Technology and SanDisk Corp., with ChangXin Memory Technologies (CXMT) now reportedly producing small quantities of an advanced memory module used in AI chipsets. 

CXMT has begun producing small quantities of HBM3E, an advanced memory technology widely used in AI accelerators, according to a report in The Information. The company plans to expand production in 2027, with Alibaba’s T-Head and Chinese AI-chip designer Cambricon already testing it with their processors. 

If testing goes as planned, the companies could use CXMT’s HBM in products as early as next year. The development could eventually put pressure on Micron, SanDisk, and South Korea’s SK Hynix, major suppliers to the booming AI-memory market. 

Micron shares gained about 16% in August, while SanDisk stock rose roughly 30%, both staging a recovery after a hard fall in July. But investors are watching risks, including the emergence of cheaper AI models, which could ultimately reduce memory demand, and the growth of the Chinese memory industry.

The Memory Market - And How It Could Change

SK Hynix has been Nvidia’s main HBM supplier, while Micron is also expanding its HBM business. CXMT’s HBM3E is still behind the leading manufacturers; the company reportedly faces low yields and remains several years behind the leaders in HBM technology. But its progress suggests that China is steadily closing the gap.  

CXMT made a blockbuster stock-market debut in Shanghai on July 27. The Chinese DRAM maker raised about 57.9 billion yuan ($8.6 billion) in the offering, making it the largest semiconductor IPO on the mainland on record. 

Investor appetite was striking: CXMT shares rose a whopping 466% on the first day. The surge briefly made CXMT China’s most valuable listed company, with a market capitalization of more than 3.2 trillion yuan. 

Another Chinese firm, YMTC, a leading NAND flash-memory maker, is pursuing a 33-billion-yuan ($4.9 billion) IPO for its parent company, CCSH, also in Shanghai.

China’s domestic AI chipmakers have faced restrictions on accessing advanced foreign memory, making a local HBM supplier strategically important. A reliable domestic alternative could help Chinese chip designers build more capable AI systems while reducing their dependence on Micron, SK Hynix and Samsung.

For memory investors, the threat also extends beyond HBM. YMTC has rapidly expanded in NAND flash and entered the global top three in shipments during the second quarter, with a 14% share, according to Counterpoint Research. SK Hynix ranked second with a 22% share, while Samsung led with 25%.  

Retail View On Memory Stocks

On Stocktwits, the retail sentiment was ‘neutral’ for MU, ‘bearish’ for SNDK and ‘extremely bearish’ for SKHY and the Roundhill Memory ETF (DRAM). Sentiment has weakened for SNDK and SK Hynix over the past week, while it has improved for MU.

According to a community poll on Stocktwits, about 82% of traders who voted believe the memory rally would continue into September.
 

“$MU this CXMT BS needs to go away for this stock to move up,” said a trader. Year to date, MU stock has risen 236% and SNDK is up 560%.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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