South Korean semiconductor giants Samsung Electronics and SK Hynix are significantly increasing investments in their Chinese wafer fabrication plants as global demand for memory chips skyrockets, driven largely by artificial intelligence computing applications. The move highlights China’s ongoing importance in semiconductor production, even as the country remains subject to U.S. export controls.
Samsung injected 465.4 billion won (approximately $308.8 million) into its Xian facility in 2025, marking a 67.5% increase from the previous year. The Xian plant, Samsung’s only overseas memory chip fab, produces around 40% of the company’s NAND output. Investment in the facility had paused between 2020 and 2023 after an initial outlay of 698.4 billion won in 2019, before resuming in 2024 with 277.8 billion won.
SK Hynix has similarly accelerated spending, investing 581.1 billion won in its Wuxi DRAM facility—a 102% increase from 2024—and 440.6 billion won in its Dalian NAND plant, up 52% year on year. The Wuxi plant contributes more than 30% of SK Hynix’s DRAM output, while Dalian serves as a key NAND production hub. Both plants had received no investments in 2023, underscoring the rapid recent escalation in capital expenditure.
Industry experts note that optimizing existing Chinese production bases is a faster route to increasing output than building new plants, which can take three to five years. Lee Byung-chul, a visiting research fellow at the Sejong Institute and former Samsung executive, emphasized that enhancing operations at current facilities allows companies to respond swiftly to the tightening memory market.
Despite these aggressive investments, analysts caution that sustaining growth in China may prove challenging due to ongoing U.S. export restrictions. Nevertheless, the moves signal a strategic bet by Samsung and SK Hynix to capture surging AI-driven demand and secure their positions in the increasingly competitive global memory chip sector.
