Tech specialist explains why China memory fears are overblown

Investing.com -- In a note to clients on Friday, Mizuho pushed back on mounting concerns that Chinese memory maker CXMT will flood the DRAM market and crush pricing, telling investors the fear is overblown.

TMT sector specialist Jordan Klein said the firm's Japan team updated its view on CXMT "to counter all the FUD around them tanking pricing with massive supply additions in coming 2 yrs post IPO."

Mizuho argued against that fear, estimating CXMT's DRAM bit supply growth will rise only 13% year over year in 2027, below the broader industry's 21%, leaving the company at roughly 8% of global share.

That would put CXMT's 2026-2028 compound annual growth rate at 24%, in line with the overall DRAM industry, which Mizuho said points to "no reckless supply expansion to try and take share with aggressive pricing."

The firm cited several constraints. Applied Materials and Lam Research suspended tool servicing on CXMT's existing equipment in March 2026, while much of that equipment is aging and due for a refresh and production-line upgrade cycle, with many tools already 10 years old.

Mizuho also flagged yield pressure from node transitions during 2027 and a lack of EUV lithography tools as "a major constraint."

Klein added that the Chinese government wants CXMT to allocate much more capacity toward high-bandwidth memory rather than conventional DRAM, which lowers the risk of oversupply.

He noted the company lags "big time in HBM" and is not selling to non-China hyperscalers, further limiting its impact on global pricing dynamics.

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