CXMT has reportedly signed a long-term agreement to supply memory worth almost $3 billion to Tencent.
CXMT & Tencent Lock-In $3 Billion Worth of Memory, Signaling That China's Premier Memory Maker Is No Different Than The Rest
Memory shortages are sky-high, and they are affecting regional markets, including China, which is going through a revolution in the adoption of AI as it races with the United States to secure the lead in the segment. This has created a boom in the number of AI firms that are showing up, leading to massive demand for compute, memory, and AI-related infrastructure.
To address these needs, China has a vast DRAM supply chain, with firms like its premier memory maker, CXMT (ChangXin Memory Technologies), leading the charge.
Recently, there have been a lot of reports that Apple is eyeing the use of CXMT memory for use in its products, as Samsung, SK Hynix, and Micron are unable to fulfill demand. The big three are already engaged in long-term contracts with strategic partners who are paying big sums of cash to procure every bit of DRAM they can get their hands on.
But it looks like CXMT is no different than these big three firms. As per Reuters, CXMT is also said to be engaging in LTAs (Long-Term Agreements) with domestic Chinese firms. The company that is named is none other than Tencent, and as per the deal, CXMT is said to provide $20 billion worth of memory to Tencent. The deal is said to span three to five years.
Chinese memory chipmaker ChangXin Memory Technologies (CXMT) has signed a long-term supply agreement with Tencent Holdings, worth more than 20 billion yuan ($2.94 billion) ahead of its blockbuster stock market debut, according to three people with knowledge of the matter.
via Reuters
There are no details on what type of memory will be supplied. Usually, AI firms select HBM due to its high-bandwidth characteristics, but more recently, LPDDR has become an industry favorite with the rise of Agentic AI workloads. LPDDR standards offer higher capacities and higher efficiency. It looks like we might be looking at either one or a mix of these technologies if the deal goes through.
One thing is clear: CXMT is not the savior that everyone hoped for. Its lower prices were a myth & have already been debunked, and the company locking in multi-billion dollar agreements with domestic Chinese firms shows that it is also no different than the big-3, which have recently been hit by a lawsuit. CXMT plans for its IPO soon, so these deals should be clear in the near future.
About the author: A Software Engineer by training and a PC enthusiast by passion, Hassan Mujtaba serves as Wccftech's Senior Editor for hardware section. With years of experience in the industry, he specializes in deep-dive technical analysis of next-generation CPU and GPU architectures, motherboards, and cooling solutions. His work involves not only breaking news on upcoming technologies but also extensive hands-on reviews and benchmarking.
Follow Wccftech on Google to get more of our news coverage in your feeds.
