Micron Withdraws From Chinese Data Center Server Chip Business
Trade Tensions Force Exit as Samsung, SK Hynix Poised to Gain Market Share
Micron, a U.S. semiconductor company, is reportedly withdrawing from its data center server chip supply business in China amid the trade conflict between the United States and China. According to Reuters on the 19th, the Chinese government banned Micron’s products from key infrastructure in 2023, targeting the company amid the U.S.-China trade war. While NVIDIA and Intel are also under Chinese authorities’ scrutiny, no regulatory measures have been imposed yet.
As China, which ranks second in the server memory market, prohibited the use of Micron’s products in core infrastructure, Micron has lost access to the Chinese data center market. Reuters reported that investments in data centers for computing in China surged ninefold last year, reaching 24.7 billion yuan. Additionally, according to the South China Morning Post, Micron decided to halt the global development of its next-generation mobile NAND products in August, leading to the layoff of hundreds of local employees in China.
However, Micron plans to continue supplying chips to customers in the automotive and mobile phone sectors in China. The country accounts for 12% of Micron’s total sales.
Analysts suggest that Samsung Electronics and SK Hynix will benefit from Micron’s withdrawal from the Chinese data center server market. Apart from Micron, Samsung Electronics and SK Hynix are virtually the only companies capable of supplying high-value-added chips for data center servers. Samsung Electronics operates a factory in Xi’an, while SK Hynix has facilities in Wuxi and Dalian.
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Micron Withdraws From Chinese Data Center Server Chip Business, source
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