US equipment license decisions, after Washington said in 2025 it would not approve technology upgrades, now set how far Samsung and SK Hynix can modernize China plants.
Samsung Electronics and SK Hynix are reworking their Chinese memory plants to make more advanced NAND flash, the storage chips used in phones, PCs and data-center drives. Reuters reported on October 21, citing four people familiar with the plans, that Samsung is converting its Xi’an plant to 286-layer chips, targeting 5,000 wafers a month by December 2026 and 40,000 a month by December 2027. SK Hynix plans to move its Dalian site from 192-layer products to chips with 240 or more layers. More layers stacked in a chip mean more storage in the same area and lower cost per bit.
Both companies told Reuters the upgrades are under way and are being carried out in close consultation with Washington, but they did not disclose production plans. The figures on wafer volumes and the Dalian layer counts come from unnamed sources, and Reuters said it could not establish how far US authorities have approved licenses for the equipment the work requires.
The timing reflects a shift in the Chinese market. YMTC held 38.5% of China’s NAND market in the second quarter, ahead of Samsung’s 33.5% and SK Hynix’s 17%, according to Omdia figures cited by Reuters. A year earlier, across 2025, YMTC had 28%, Samsung 36% and SK Hynix 20%.
Xi’an and Dalian carry a large share of Korean NAND output
The plants matter to both companies’ totals. Reuters put Xi’an at about 40% of Samsung’s global NAND output, and the Korea JoongAng Daily reported in August that Dalian handles about 30% of SK Hynix’s NAND. TrendForce gives its own estimates of China’s share at roughly 30% to 35% of Samsung’s NAND output and 40% to 45% of SK Hynix’s.
According to Reuters, Samsung’s Xi’an plant now makes chips with around 200 layers, and the shift to its 286-layer ninth-generation V-NAND runs under an internal project called "Monami." Samsung said the upgrade complies with US export rules and is "aimed at meeting growing demand from global customers, including those in the US." It added that it "is not expanding production capacity or constructing new manufacturing facilities."
Dalian came to SK Hynix with its 2021 purchase of Intel’s NAND business, now called Solidigm, and remains that unit’s only NAND manufacturing site. One Reuters source said SK Hynix is authorized to make chips of up to 240 layers there and may seek Washington’s permission for research on chips with more than 300 layers, which could prepare the ground for production in the United States. Reuters also reported that the company is discussing a new US NAND plant with the Trump administration. Both companies were already raising spending in China before this report: the Korea JoongAng Daily said Samsung’s equity investment in Xi’an rose 68% in 2025 to 465.4 billion won, and SK Hynix’s Dalian investment rose 52% to 440.6 billion won.
Washington’s licensing stance is the main constraint
The upgrades run up against a 2025 change in US export controls. The Commerce Department’s Bureau of Industry and Security (BIS) revoked the validated end-user (VEU) status of Samsung China Semiconductor and SK hynix Semiconductor (China), effective December 31, 2025, according to an alert from law firm ArentFox Schiff. VEU status had let US suppliers ship controlled tools to those plants without individual licenses. BIS said it intended to grant licenses that let the firms run their existing China fabs, but not licenses to expand capacity or upgrade technology.
The two companies now apply each year for licenses to install US-made tools such as etching machines. Asked about the status of approvals, BIS did not answer directly and pointed Reuters back to that 2025 statement, so it is unclear how 286-layer conversions fit within it. Samsung’s stated position is that it is upgrading technology without adding capacity. EastFrontier has reported that both companies were testing tools from China’s AMEC at their Chinese fabs; the Korea JoongAng Daily noted that both denied any testing that breaches US rules.
YMTC is already working on chips with more than 300 layers
The Korean upgrades would bring the China plants closer to YMTC’s most advanced products while still trailing what both firms make outside China. YMTC’s range is mostly 160-layer and 232-layer NAND, but two Reuters sources said it already makes a small volume of 294-layer chips and plans products above 300 layers. YMTC did not respond to Reuters. Outside China, Samsung sells NAND with up to 286 layers and showed a prototype with more than 400 layers in August, while SK Hynix sells chips with up to 321 layers.
YMTC has been building out its role in data-center storage, the same AI-driven demand the Korean firms cite. The next marker is whether Samsung reaches its reported 5,000-wafer monthly rate at Xi’an by December, and whether SK Hynix applies to BIS for research on 300-plus-layer chips at Dalian, a request that would test how far Washington will stretch its 2025 position.