Chinese memory chip maker CXMT surges in IPO. Does the memory of the United States have a chance?

00:00 speaker a

We are looking at semiconductor stocks sold out today, and it seems that at least in part the competition is emerging from China, especially the blockbuster IPO for the company CXMT in the Chinese mainland stock market, raising I think about $ 10 billion in that IPO.

00:20 speaker b

It’s a Chinese company that makes uh RAM uh memory. Uh basically the kind of chips that uh Micron, SK Hynix, uh Samsung uh make uh into, you know, smartphones, computers, things like that. Uh they’re very scarce uh because of the kind of broader AI construction, which kind of all those chips around the world and and take a lot of capacity for uh manufacturers to pump it out. Uh and so we’re in an area where we have this, you know, limited supply and there are companies that manufacture those chips, but we don’t have access to it here in the United States uh as a result of, international and geopolitical uh kind of issues between the United States and China. Uh and so uh the big story here is that companies like Apple uh and others are basically lobbying the Trump administration to allow this chip these chips to be used in their products uh internationally, not necessarily uh in the US market.

01:46 speaker a

Well, and they can use them in China, right? Like Apple’s iPhones that it sells in China can have CXMT chips in them.

01:52 speaker b

Well, yes. And this is basically, uh saying, you know, look, we want to expand the use of that, uh kind of reduce the dependence that we have on, you know, Micron and others, uh just to base their supply and hopefully not have to increase the price of their products anymore. And so, that’s why we’re seeing a huge kind of excitement around this stock and this IPO. Oh, it just has to do as I said with the wider memory market. I mean these companies have been on fire uh for the last few months, just as a result of the huge, huge demand that we’re seeing in AI.