4 Billion-a-Day Profit for "China's SK Hynix": Even Apple Is Bidding to Buy

Original author: Jialiu

When it comes to the global storage industry, most people only know Samsung, SK Hynix, and Micron. However, many are unaware that ranking fourth globally is a Chinese company that has yet to go public, named ChangXin Memory Technologies (CXMT).

On July 9, CXMT updated its latest IPO prospectus for the STAR Market. In terms of timeline, the subscription is on July 16, payment on the 20th, and trading on the STAR Market could potentially begin by the end of the month.

China’s strongest storage leader is coming by the end of the month.

Data shows that the estimated revenue for Q1 2026 is 50.8 billion yuan, a year-on-year increase of 719%. Net profit stands at 33 billion yuan. Earning nearly 4 billion yuan per day, its profitability surpasses Kweichow Moutai. The market has given it a trillion-yuan market cap, with potential to become the highest-valued stock on the A-share market.

As of the end of 2025, the company’s cumulative losses were still 36.65 billion yuan.

In other words, CXMT recouped nine years of losses in just six months. This domestic chip company, which had been losing money for nearly a decade, suddenly became one of the most profitable hard-tech enterprises in the A-share market.

Over the past week, the name CXMT has appeared frequently in global tech media. Apple is lobbying the U.S. government to apply for a special license to include CXMT in the memory supply chain for Macs and iPads. Google has also initiated a procurement evaluation for CXMT's DRAM. Other reports mention that HP and Dell are validating CXMT’s DRAM, while Acer and ASUS are urging their Chinese partners to adopt more domestic storage chips. In the same week, Reuters disclosed that Tencent has signed a long-term supply agreement for server DRAM with CXMT worth over 20 billion yuan, lasting three to five years. CXMT’s prospectus customer list also includes Alibaba Cloud, ByteDance, Lenovo, Xiaomi, OPPO, vivo, and Honor.

Leading companies in the global memory production field, CXMT ranks fourth globally, behind Hynix, Samsung, and Micron. Source: Reuters

Suddenly, CXMT has become a favorite among almost all major domestic and international companies.

How did CXMT rise from zero to become the global fourth? How much of its current profit is due to strength versus luck? Can its trillion-yuan valuation hold?

The Path Before CXMT: GigaDevice

The origin story of CXMT begins with understanding why China has long lacked DRAM.

Storage chips come in many types. NAND Flash retains data even when power is off; it's used in phone hard drives, SSDs, and USB drives. DRAM is runtime memory—data disappears when power is off, but it's fast, acting as a workstation alongside CPUs, GPUs, phone SoCs, and AI accelerator cards.

Both NAND and DRAM are commodity semiconductors, but DRAM is more like a steel mill combined with high-precision manufacturing. Each generation of process technology requires pushing capacitors, transistors, word lines, and bit lines to their limits, replicating billions of highly consistent units on a single wafer. A slight imperfection drops the yield and inflates costs. When costs spike during a memory downcycle, money drains away like water.

This is why the DRAM market is left with only three giants: Samsung, SK Hynix, and Micron. This is not a game one enters simply by saying "I have a technical team." It requires enduring price wars, capacity wars, patent battles, equipment restrictions, and customer qualification over cycles spanning a decade or more.

CXMT was launched around 2016, based in Hefei. Its key figure is Zhu Yiming.

Photo of Zhu Yiming at a meeting

The name Zhu Yiming is not unfamiliar in China’s semiconductor circle.

Born in 1972, Zhu Yiming is somewhat of a child prodigy. He was admitted to the Physics Department at Tsinghua University at age 17. Although he studied physics, he was exceptionally skilled at programming. By writing programs for other companies in the late 1990s, he could earn over 300,000 yuan a year. During his work, he learned that chips were designed in the U.S. back then. Believing chip technology to be more sophisticated, he went to the U.S. to study electronic engineering and later worked in Silicon Valley after graduation.

An early photo of Zhu Yiming (right)

In Silicon Valley, Zhu Yiming noticed that the storage industry had shifted from the U.S. to Japan, then to South Korea and Taiwan, China. He judged that mainland China would also have a significant opportunity in the future, potentially birthing a "Chinese version of Samsung." He designed an SRAM (Static Random-Access Memory) chip and returned to China in 2005 to found a company called GigaDevice.

GigaDevice was a pure design house from its inception; it didn't manufacture chips itself, outsourcing all wafer fabrication to foundries. Its main products were NOR Flash (storage chips used in router boot programs, game consoles) and MCUs (microcontrollers for controlling refrigerators, washing machines). Zhu Yiming led the team to create China’s first static memory and IP technology, first serial flash product, and first 32-bit general-purpose MCU based on the ARM Cortex-M3 architecture. By the time it went public in August 2016, it was already mainland China's largest code flash memory chip design company, with revenue growing from 1.489 billion yuan in its listing year to 9.203 billion yuan.

Asset-light, high gross margins, no need to build its own factory. This was the smartest way for Chinese IC design companies to operate at the time.

But this model had one prerequisite: abundant foundry capacity and stable prices. In the second half of 2020, Zhu Yiming hit a bottleneck. SMIC's 8-inch wafer capacity became severely constrained, forcing GigaDevice to shift some NOR Flash orders to Hua Hong Semiconductor's 12-inch fab, resulting in higher foundry costs. In Q4 2020, the gross margin plummeted from its previously stable level above 37% to 29.49%. The consequences of being strangled by foundry capacity were directly reflected on the income statement for the first time.

During the same period, GigaDevice was also paying for another acquisition. In 2019, it acquired Shanghai Silead for 1.7 billion yuan—a 16x premium—creating 1.305 billion yuan in goodwill. Silead made under-display fingerprint chips. Zhu Yiming wanted to combine memory, controllers, and sensors into a platform-type design company. However, Goodix sued Silead for patent infringement, leading to a price war. Silead only fulfilled 58% of its three-year performance commitment. From 2020 to 2023, GigaDevice took goodwill impairments on Silead for four consecutive years, totaling about 900 million yuan, eating away most of the 1.3 billion yuan goodwill. The approach of expanding product categories by acquiring another design company horizontally had proven unworkable.

Zhu Yiming's lesson from these two events was that the ceiling for an asset-light design company lies not in design capability, but in capacity. Furthermore, the real battleground for memory chips wasn't in NOR Flash—a category holding only 2.5% of the global market—but in DRAM. Yet DRAM, unlike NOR Flash, couldn't be produced by general-purpose foundries. DRAM processes are highly proprietary. Each manufacturer's cell structure, capacitor design, and word line process are customized. Samsung, SK Hynix, and Micron all operate under an integrated design-and-manufacturing model. For anyone wanting to pursue DRAM, there was only one path: build your own fab.

This is the background and reason for CXMT's birth.

Hefei’s Third Big Bet, After BOE and NIO

GigaDevice's financials and shareholder structure couldn't support the investment scale needed for DRAM fab construction. After all, the first phase alone cost 18 billion yuan, with total investment exceeding 100 billion yuan and nearly a decade of continuous losses. This money had to come from a different kind of capital.

In 2016, the Hefei government extended an olive branch.

The market often calls Hefei the "city best at venture capital." Its most successful venture capital story is BOE. This starting point for the world's largest LCD panel shipper (with annual revenue exceeding 200 billion yuan) and the company enabling Chinese panel makers to secure 70% of the global LCD market share—all began in Hefei.

In September 2008, BOE and Hefei signed a framework agreement for a Gen 6 production line investment. The total project investment was 17.5 billion yuan, with a registered capital of 6 billion yuan from Hefei. The capital was injected via a BOE private placement, then fully invested into the project company. Instead of simply giving BOE a subsidy, Hefei used local platforms to take controlling stakes, advanced funds, provided loan interest subsidies, and supported land and energy needs, carrying BOE through its most difficult construction phase. Around BOE, Hefei continued to attract suppliers of glass substrates, polarizers, driver chips, and equipment materials, earning the city the label "Capital of New Displays."

The second typical story is NIO. In April 2020, NIO was just climbing out of its life-and-death crisis from 2019. Hefei Construction Investment, Anhui Emerging Industry Investment, and others collectively invested 7 billion yuan in cash into NIO China, establishing NIO China's headquarters in Hefei Economic and Technological Development Zone. NIO later became one of China's representative high-end EV brands, with its market cap once exceeding $100 billion.

Identify a heavy-asset leader, use transaction structures instead of simple subsidies, help the company weather its construction phase, and then leverage the leader to solidify the upstream and downstream supply chain locally.

In 2016, Hefei applied the same investment logic to its next big bet.

An early key figure at Hefei Industry Investment, Yuan Fei, later said: "Whether it was Hefei Industry Investment or the industrial partner, everyone involved in CXMT's early stages bore unprecedented risk and pressure."

After all, DRAM is even harder than display panels or complete vehicles, with higher risks across technology, equipment, yield, patents, and export controls. But from the perspective of local industrial organization, it is just like BOE and NIO—short-term money pits that, if successful in the long run, can fundamentally alter the supply and demand dynamics of an entire industry chain.

Hefei, Anhui, promotes the integrated circuit industry

Hefei Industry Investment contributed 14.4 billion yuan to the first phase of CXMT alone, with the total project investment exceeding 100 billion yuan.

In July 2018, GigaDevice announced: Zhu Yiming resigned as general manager to remain solely as chairman, formally taking the roles of CXMT Chairman and CEO. The industry called this Zhu Yiming's "second startup."

The current shareholder list shows the composition of this bet. The top five shareholders are Qinghui Jidian (21.67%, fully controlled by Hefei state-owned assets), CXMT Jicheng (11.71%), Big Fund Phase II (8.73%), Hefei Jixin (8.37%), and Anhui Investment (7.91%). Hefei state-owned assets hold a combined stake of over 36%.

Among other shareholders, Alibaba Cloud holds 3.85% (6.1 billion yuan investment, corresponding to a valuation of 158.4 billion yuan), and GigaDevice holds 1.8%. The investor list also includes China Structural Reform Fund, CICC Capital, Legend Capital, China Merchants Capital, Yunfeng Capital, Tencent, and Alibaba.

The money and momentum were in place. But Zhu Yiming's "second startup" still lacked one thing: core technology.

The Technological Legacy of a Bankrupt German Company

Around 2016, the three giants—Samsung, SK Hynix, and Micron—collectively controlled over 90% of the global DRAM market share. This was the result of a decade-long knockout tournament.

Starting in the 1980s, the DRAM industry killed off players every few years.

Japan once held over 80% of global DRAM production capacity but by the 2010s, only Elpida was left struggling, eventually acquired by Micron in 2012. Europe once had Qimonda, a subsidiary of Infineon, but it went bankrupt in 2009.

Zhu Yiming's solution lay hidden within this German company that had already gone bankrupt in 2009.

The name Qimonda comes from two words. "Qi" is Chinese for "energy" or "flowing power." "Monda" is Latin for "world." The literal meaning: the key to opening the world.

The name was beautiful. The company's fate was tragic.

After being spun off from its parent company Infineon in May 2006, Qimonda listed on the NYSE on August 9, 2006, under the ticker QI. At its listing, it was already one of the world's leading suppliers of memory products and a leader in 300mm wafer manufacturing technology. By 2008, Qimonda had completed the development of a 46nm stacked process product based on Buried Word Line technology, offering a 100% capacity improvement over the previous 58nm generation, and was just short of mass production.

Image of Qimonda DDR2/GDDR chip products

But the financial crisis hit. DRAM prices plummeted, and Samsung expanded capacity at a loss to pressure competitors. Qimonda's new technology was not yet ready for mass production, and its cash flow ran dry. It went bankrupt in 2009. The lights went out for Europe's last major storage company. The Munich R&D center was emptied, and 12,000 employees scattered, absorbed by Samsung, Micron, and SK Hynix. In 2012, Qimonda's bankruptcy trustee began selling off its 7,500 patents.

Zhu Yiming saw his opportunity in this history.

Qimonda died from the cycle, not from technology. Its legacy—2.8 TB of technical files and tens of thousands of patents—was a treasure trove frozen for nearly a decade. Traces of Qimonda's buried word line and honeycomb capacitor structures can actually be found in the DRAM products of Samsung, Micron, and SK Hynix today, having indirectly flowed into the process systems of the three giants via partners like Inotera and Winbond.

But how to obtain this legacy and use it to build a factory was a huge problem, with a bloody lesson preceding it.

2016 was considered the "Year Zero" for the resurgence of memory in China. Before this, China's DRAM industry had completely declined, facing technological monopolies from foreign companies like the U.S. and South Korea, leaving China with no means to retaliate.

At that time, when China launched its national memory project, there were two other routes alongside CXMT: Yangtze Memory Technologies Corp (YMTC) for NAND Flash in Wuhan, and Fujian Jinhua Integrated Circuit for DRAM.

In 2017, Micron filed simultaneous lawsuits in the U.S. and Taiwan against UMC and Jinhua, accusing three employees who had moved from Micron to UMC of stealing Micron's DRAM trade secrets. One employee was alleged to have stolen over 900 technical files. In October 2018, the U.S. Department of Commerce added Fujian Jinhua to the Entity List for national security reasons, imposing export controls. UMC immediately announced a suspension of its technology cooperation with Jinhua. Equipment was cut off, technical collaboration froze, and the project stalled. The U.S. Department of Justice simultaneously filed criminal charges against Jinhua and UMC for economic espionage, facing potential fines exceeding $20 billion. The dispute lasted for six years until a global settlement between Micron and Jinhua was reached in late 2023.

Fujian Jinhua's lesson was already clear: getting entangled in trade secret disputes related to Micron leads to being placed on the Entity List, resulting in equipment cutoffs and project paralysis. A new DRAM company with IP landmines faces reluctance from commercial customers, equipment suppliers, and risks being crippled by litigation in the international market.

Therefore, when Qimonda's bankruptcy trustee started selling off