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Anton Shilov is a contributing writer at Tom\u2019s Hardware. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends. ","collapsible":{"enabled":true,"maxHeight":250,"readMoreText":"Read more","readLessText":"Read less"}}), "https://slice.vanilla.futurecdn.net/13-4-24/js/authorBio.js"); } else { console.error('%c FTE ','background: #9306F9; color: #ffffff','no lazy slice hydration function available'); } Anton Shilov Social Links Navigation Contributing Writer Anton Shilov is a contributing writer at Tom’s Hardware. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.
endocine "While domestic AI and data center sectors are important, keeping the electronics industry afloat is even more crucially important for China's federal and local governments, as unemployment can hurt the country more than the lack of an AI model or service." too bad companies in other countries don't realize any of this, they are content to let it all collapse chasing singular short term profits that will not last forever, but the damage by the time AI normalizes could be permanent Reply
hwertz I think another reason for this is simply they are running slightly older lithography processes, they can produce all ddr4 speeds and most ddr5 speed (but top out at ddr5-8000 or so), I imagine HBM4 might be difficult for them to produce. And, of course, there's a genuine, immediate shortage in DDR4 and 5 so it might be more profitable for them than HBM4 where who knows how much additional demand there is? (It's a memory cartel saying 'sorry our capacity is tied up with HBM for the next year or two', this doesn't indicate whether the supply is actually tight or they're already just meeting demand.) Reply
althuser endocine said: "While domestic AI and data center sectors are important, keeping the electronics industry afloat is even more crucially important for China's federal and local governments, as unemployment can hurt the country more than the lack of an AI model or service." too bad companies in other countries don't realize any of this, they are content to let it all collapse chasing singular short term profits that will not last forever, but the damage by the time AI normalizes could be permanent I just want China be very successful and being the peoce of these things tumbling down again. They can do it Reply
Arkitekt78 I wouldn't call an unsustainable flow of government bailout money an advantage… Once again, Chinese show themselves to be smoke and mirrors with everything they do. Reply
suau Arkitekt78 said: I wouldn't call an unsustainable flow of government bailout money an advantage… Once again, Chinese show themselves to be smoke and mirrors with everything they do. That's the thing though, they don't really need bailouts anymore going forward. The big 3 produced memory chips efficiently at a low price, CXMT can not compete on price if they have to apply the best technology they have at their disposal to match something that's just another tuesday for Samsung/Micron/Hynix. But that cost-advantage is now gone that prices at 400-500%, CXMT probably can profitably produce memory chips for that price. To put it in other words, Samsung/Micron/Hynix produced memory chips with a 90%+ yield, meaning 9 out of 10 they were able to sell and 1 went into the trash can and it was still profitable. With the 5x price increases, CXMT just needs 20% of those 90% to be profitable, so less than 2 out of 10 need to pass QC and they can throw away the other 8 and STILL BE PROFITABLE. Reply
wolfferth suau said: That's the thing though, they don't really need bailouts anymore going forward. The big 3 produced memory chips efficiently at a low price, CXMT can not compete on price if they have to apply the best technology they have at their disposal to match something that's just another tuesday for Samsung/Micron/Hynix. But that cost-advantage is now gone that prices at 400-500%, CXMT probably can profitably produce memory chips for that price. To put it in other words, Samsung/Micron/Hynix produced memory chips with a 90%+ yield, meaning 9 out of 10 they were able to sell and 1 went into the trash can and it was still profitable. With the 5x price increases, CXMT just needs 20% of those 90% to be profitable, so less than 2 out of 10 need to pass QC and they can throw away the other 8 and STILL BE PROFITABLE. Well, even american OEMs ship their devices with chinese chips. 😉 It's a big club. Reply
nrdwka Arkitekt78 said: I wouldn't call an unsustainable flow of government bailout money an advantage… Once again, Chinese show themselves to be smoke and mirrors with everything they do. Force companies via regilulation to limit their greed and have sustainable profit, is not the same as "flow of bailout money" 🤔 Reply
hwertz suau said: To put it in other words, Samsung/Micron/Hynix produced memory chips with a 90%+ yield, meaning 9 out of 10 they were able to sell and 1 went into the trash can and it was still profitable. With the 5x price increases, CXMT just needs 20% of those 90% to be profitable, so less than 2 out of 10 need to pass QC and they can throw away the other 8 and STILL BE PROFITABLE. Yup, and I'm sure their yield is nowhere near that low. CXMTs fabs are like 5-7 years behind state of the art; Samsung, Micron, and Hynix were all profitably selling DRAM at around $3 a GB 5-7 years ago (well, THEY probably sold the chips for less, the DDR sticks were that price). For a while it dropped well below $2 a GB, but that was recently enough that they may have been using newer fabs… and it didn't take long at all for the cartel to take action and drive prices back up at that point. I imagine rather than having quite a few bad sticks (totally non-functional) there'd probably be a lot of binning going on, like you get toward the 6667 MT/sec and higher and there'll be fewer that operate stably at those speeds. Reply
Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/pc-components/ssds/SPONSORED_LINK_URL
- https://www.tomshardware.com/pc-components/ssds/chinese-makers-of-dram-modules-ssds-have-a-serious-advantage-over-american-and-taiwanese-suppliers-says-smi-svp-state-guidance-secures-local-dram-and-ssd-supply-while-the-big-three-chase-ai-margins#main
- https://www.tomshardware.com/membership
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