MU is down $90 today after CXMT announced a tremendous breakthrough in HBM3E. Again, this is tech but it's an interesting turn. Let's run this through the BS meter. Here's what we know: - CXMT struggled with HBM3 yields as recently as 2 months ago (rumors of 25% yield) - CXMT HBM3E is currently in risk production - TrendForce has not picked up this story or made any mention of it - Micron has said it can only produce 1/2 to 2/3 of demand for HBM3 - HBM requires 3x the wafer area of DDR5, CXMT promises 4x density improvement of HBM3 which would make it cheaper than DDR5 - If the CXMT 4x density improvement announcement is remotely true, it will be a massive step forward, even if their parts only meet HBM3 spec and even if their yield does not top 50% - Based on the description provided by CXMT, new dies can be stacked 12 high for 36GB of on complex HBM3/E, just like any other HBM3/E compatible part - CXMT started shipping HBM3 at the end of 2025 so it's been nearly a year of extremely limited quantity production - Micron has shipped over $1B of HBM4 (they don't share die or capacity count) and countless HBM3/E BS Meter = 20% likely to be sufficiently true as to be a market factor Likely reality = They are probably onto something and it could easily bear fruit but I'm extremely skeptical of their timeframe given they were struggling with yield 6 weeks ago and also because of past ridiculous and unsubstantiated announcements. Narrative: China has made so many announcements that turned out to be complete crap that it's difficult to take anything they say seriously. The retail investing market, of course, does not take the time to consider credibility and has forgotten the endless stream of past lies. Has everyone forgotten when they announced they had 2N figured out and ready for production, ahead of the rest of the world? That was two years ago and a different company but Chinese semis are still struggling with 7N and even 10N yields. This lack of credibility does not eliminate the fact that China is working hard and making good progress with semiconductors. HBM3E is generally suited to 10N, so there is some plausibility to the CXMT claim. Micron remains a better bet than ever, IMO. It's not all clear sailing for Micron. Micron advises roughly 2x cost increase from suppliers that will impact FY27. The next three Micron Fabs to come online are: Tongluo, Virginia (significant expansion), Taiwan. These three fabs are built and currently doing early qualification work. Production will from these will not affect Micron's bottom line this year and they won't be fully online until roughly the end of next year. This slow (to us but the Fab itself is working hard) ramp process is one of the reasons CXMT's new process announcement is unlikely to be true. Again, I'm not declaring it a hoax but the odds of being able to buy reasonably priced HBM3E on January 1, 2027 is zero.
Here's a media report card based on the above post. Reuters headline "China's CXMT makes breakthrough in advanced memory chips, the Information reports" Thoughts - There is a modest hedge in the article but Reuters is basically parroting the CXMT announcement in full detail Yahoo headline "China memory leader CXMT begins small-batch production of HBM3E silicon - report" Thoughts - Similar small hedge but essentially presents the announcement as fact Tom's Hardware headline "CXMT president says company’s first 4F² DRAM will be a server DDR5 RDIMM due by year-end — vertical transistors cut each memory cell’s footprint by a third on paper, but no speeds or capacities yet" Thoughts - The article goes into some detail on VSG and 4F2. It's actually quite informative. To be honest, I'm surprised at the quality of the article and the perspective it brings. While not particularly skeptical, it does mention the CXMT struggle with 10N and their struggle to be taken seriously by the semi industry. Kudos to Tom's Hardware on providing a bit of detail and some perspective. Reuters and Yahoo phoned this one in, exactly as expected.
