Two Chinese chipmakers are in the early stages of producing high bandwidth memory (HBM) semiconductors used in artificial intelligence chipsets, according to sources and documents.
The progress in HBM - even if only in older versions of HBM
- represents a major step forward in China's efforts to reduce its reliance on
foreign suppliers amid tensions with Washington that have led to restrictions
on U.S. exports of advanced chipsets to Chinese firms.
CXMT, China's top manufacturer of DRAM chips, has developed
sample HBM chips in partnership with chip packaging and testing company Tongfu
Microelectronics, according to three people briefed on the matter. The chips
are being shown to clients, two of them said.
Tongfu Microelectronics' shares surged 8% in Wednesday
trade.
In another example, Wuhan Xinxin is building a factory that
will be able to produce 3,000 12-inch HBM wafers a month with construction
slated to have begun in February this year, documents from corporate database
Qichacha show.
CXMT and other Chinese chip firms have also been holding
regular meetings with South Korean and Japanese semiconductor equipment firms
to buy tools to develop HBM, said two of the people.
The sources were not authorised to speak on the matter and
declined to be identified. Hefei-based CXMT or ChangXin Memory Technologies and
Tongfu Microelectronics did not respond to requests for comment.
Wuhan Xinxin, which has flagged to regulators that it is
interested in going public, and its parent company did not respond to requests
for comment. The parent company is also the parent of NAND memory specialist
YMTC or Yangtze Memory Technologies. YMTC said it did not have the capability
to mass produce HBM.
Both CXMT and Wuhan Xinxin are private companies which have
received local government funding to advance technologies as China pours
capital into developing its chip sector.
Wuhan's local government also did not respond to requests
for comment.
Separately, Chinese tech behemoth Huawei - which the U.S.
has deemed a national security threat and is subject to sanctions - is aiming
to produce HBM2 chips in partnership with other domestic companies by 2026,
according to one of the sources and a separate person with knowledge of the
matter.
The Information reported in April that a Huawei-led group of
companies aiming to make HBM includes Fujian Jinhua Integrated Circuit, a
memory chip maker also under U.S. sanctions.
Huawei, which has seen demand soar for its Ascend AI chips,
declined to comment. It is not clear where Huawei procures HBM. Fujian Jinhua
did not respond to a request for comment.
LONG JOURNEY AHEAD
HBM - a type of DRAM standard first produced in 2013 in
which chips are vertically stacked to save space and reduce power consumption -
is ideal for processing massive amounts of data produced by complex AI
applications and demand has soared amid the AI boom.
The market for HBM is dominated by South Korea's SK Hynix -
until recently the sole HBM supplier to AI chip giant Nvidia according to
analysts - as well as Samsung, and to a lesser extent U.S. firm Micron
Technology. All three manufacture the latest standard - HBM3 chips - and are
working to bring fifth-generation HBM or HMB3E to customers this year.
China's efforts are currently focused on HBM2, according to
two of the sources and a separate person with direct knowledge of the matter.
The U.S. has not put restrictions on exports of HBM chips
per se but HBM3 chips are made using American technology that many Chinese
firms including Huawei are barred from accessing as part of the curbs.
Nori Chiou, an investment director at White Oak Capital and
a former analyst who looked at the IT sector, estimates that Chinese chipmakers
lag their global rivals by a decade in HBM.
"China faces a considerable journey ahead, as it
currently lacks the competitive edge to rival its Korean counterparts even in
the realm of traditional memory markets," he said.
"Nonetheless, (CXMT's) collaboration with Tongfu
represents a significant opportunity for China to advance its capabilities in
both memory and advanced packaging technologies within the HBM market."
Patents filed by CXMT, Tongfu and Huawei indicate that plans
to develop HBM domestically date back at least three years when China's chip
industry increasingly became the target of U.S. export controls.
CXMT has filed almost 130 patents in the United States,
China, and Taiwan for different technical issues related to the manufacturing
and functionalities of HBM chips, according to Anaqua's AcclaimIP database. Of
those, 14 were published in 2022, 46 in 2023, and 69 in 2024.
One Chinese patent, published last month, shows the company
is looking at advanced packaging techniques like hybrid bonding to create a
more powerful HBM product. A separate filing shows that CXMT is also investing
in developing technology needed to create HBM3. Reuters