China AI Memory Chips Market Size and Forecast by Type, Node Type, End User Application, and Distribution Channel: 2019-2033

China AI Memory Chips Market Outlook

Amid rising geopolitical tension and a fierce global race for semiconductor supremacy, the China AI Memory Chips Market is undergoing a radical transformation. Reaching a projected $5.1 billion by 2033. This accelerated growth stems from a confluence of strategic government initiatives, massive capital investments, and a collective push by domestic players to reduce dependency on foreign technologies in artificial intelligence (AI) chip development.

One of the most pivotal moves came from Xiaomi, which announced a $6.9 billion investment over the next decade to ramp up semiconductor research, particularly in high-end AI chips for smartphones. Founder Lei Jun has emphasized that chip development is a “long-term war,” calling for national support as the company expands its in-house R&D team of over 2,500 engineers. Xiaomi’s renewed push follows its earlier attempt with the Surge S1 chip in 2017, which was halted due to financial and technical setbacks. However, since 2021, the company has allocated nearly ¥13.5 billion toward chip innovation—an investment that signals serious intent.

Beijing’s broader ambition of semiconductor self-sufficiency is also catalyzing this market. In May 2024, the Chinese government launched its largest-ever chip fund of $47.5 billion under the “Big Fund” umbrella. Backed by state-owned banks like ICBC and China Construction Bank, the initiative aligns with the "Made in China 2025" strategy, targeting leadership in AI, 5G, and quantum technologies. This fund is driving the local production of AI memory chips and incentivizing innovation, particularly in companies like SMIC and Huawei, which are navigating complex export controls to develop competitive alternatives.

Despite facing U.S. sanctions and severe export restrictions on advanced lithography machines from ASML, Chinese companies have made unexpected technical strides. Semiconductor Manufacturing International Corporation (SMIC) recently stunned the industry by manufacturing 5nm chips without using EUV lithography. Instead, SMIC relied on Deep Ultraviolet (DUV) lithography in combination with Self-Aligned Quadruple Patterning (SAQP), powering Huawei’s Ascend 920 AI chip. This accelerator delivers a performance benchmark of 900 TFLOPS—a 30–40% improvement over previous iterations—underscoring the robustness of domestic chip innovation.

However, challenges persist. China’s chipmakers still rely heavily on imported lithography equipment, and its most advanced domestic scanner supports only 65nm resolution. Meanwhile, ASML’s sub-10nm EUV systems remain out of reach due to Dutch export bans. In response, China is stockpiling chipmaking tools, having spent over $24.7 billion in early 2024 alone—surpassing the combined equipment investments of the U.S., Taiwan, and others.

Further demonstrating its technological resilience, China achieved the world’s first mass production of a 28nm embedded RRAM image quality chip for Mini LED displays, developed by Xianxin Technology. This chip, built with fully indigenous intellectual property, replaces external flash with embedded RRAM, reducing both power consumption and unit cost. Another breakthrough came from Hong Kong Polytechnic University, which co-developed the world’s first 16-bit quantum bit semiconductor microprocessor. This chip leverages a photonic quantum network to simulate molecular spectra, marking a critical milestone in the intersection of AI and quantum computing.

Industry executives are optimistic but pragmatic. According to David Gomes, Manager – IT, “China’s approach mirrors its EV industry playbook: aggressive investment, vertical integration, and policy protection. But semiconductors are a different beast—more complex, more global, and more sensitive to geopolitics. Still, the progress in AI memory chip design and architecture is ahead of where many expected.”

The China AI Memory Chips Market is also shaped by global tensions. Washington's recent controls over Huawei’s Ascend chips have triggered a backlash, with China accusing the U.S. of “unilateral tech bullying.” Nvidia CEO Jensen Huang openly criticized these moves, noting they have unintentionally accelerated China’s AI chip ambitions. As international collaboration fragments, Chinese firms are doubling down on regional supply chains, forging deeper ties with partners across Asia and Europe.

With the rise of data centers, autonomous driving, and AI-powered consumer electronics, memory remains a linchpin in next-gen computing. Companies like YMTC and CXMT are pushing into DRAM and NAND flash memory segments specifically tailored for AI workloads, capitalizing on new architectures such as Compute Express Link (CXL) and High Bandwidth Memory (HBM). These advances are crucial as China looks to optimize latency, bandwidth, and power efficiency for large-scale AI training and inference systems.

Looking ahead, the convergence of AI, quantum computing, and next-generation memory technologies positions China’s AI chip ecosystem for sustained growth, albeit within a challenging global context. Regulatory support, state-backed funding, and national urgency are turning what once seemed an uphill battle into a high-stakes sprint toward self-reliance and innovation dominance.

Author: David Gomes (Manager – IT)

*Research Methodology: This report is based on DataCube’s proprietary 3-stage forecasting model, combining primary research, secondary data triangulation, and expert validation. [Learn more]

China AI Memory Chips Market Scope