Propelled by staggering double-digit growth across every segment from fabrication to packaging, China’s semiconductor industry is no longer just catching up—it’s fundamentally reshaping the global chipmaking landscape.
Key Takeaways
- In 2023, China's semiconductor fabrication capacity reached 9.9 million wafers per month (8-inch equivalent), marking a 16% year-on-year increase
- SMIC's total monthly production capacity exceeded 800,000 12-inch wafers by end of 2023, with plans to expand to 1 million by 2025
- China's share of global semiconductor front-end fabrication capacity grew to 16% in 2023 from 13% in 2022
- China's semiconductor industry revenue reached 1,041 billion yuan (about $145 billion) in 2023, up 16.1% YoY
- SMIC's 2023 revenue was 52.6 billion yuan, a 19.3% increase, with 7nm contributing 10%
- Huawei HiSilicon's revenue estimated at $15 billion in 2023, driven by Kirin and Ascend chips
- In 2023, SMIC achieved 7nm process yield rates above 40% in volume production for Huawei Kirin 9000S
- YMTC's Xtacking 3.0 232-layer NAND entered mass production in Q4 2023 with 20Gbit dies
- CXMT began 17nm DRAM class10 production in 2023, with roadmap to 12nm by 2025
- In 2023, China's Big Fund invested 344 billion yuan ($47.5B) into semiconductors since 2014 inception
- National Integrated Circuit Industry Investment Fund Phase III raised 344 billion yuan in 2024 for advanced nodes
- Shanghai government allocated 100 billion yuan for chip industry from 2021-2025
- In 2023, US export controls blocked $5 billion in equipment sales to China chip firms
- China's chip imports fell 8.9% to $385 billion in 2023 due to stockpiling pre-sanctions
- SMIC revenue growth slowed to 19% in 2023 impacted by US bans on ASML EUV
China's chip industry grew significantly in 2023 despite persistent external pressures and sanctions.
Challenges and Global Trade
- In 2023, US export controls blocked $5 billion in equipment sales to China chip firms
- China's chip imports fell 8.9% to $385 billion in 2023 due to stockpiling pre-sanctions
- SMIC revenue growth slowed to 19% in 2023 impacted by US bans on ASML EUV
- China imported 98% of high-end lithography tools pre-2022, now seeking domestic alt
- YMTC added to US Entity List Oct 2022, cutting off Micron partnership 2023
- China's self-sufficiency in logic chips <10% for sub-14nm in 2023
- Dutch ASML sales to China dropped 20% in 2023 due to US pressure on DUV
- Huawei revenue from chips down 30% in 2023 from pre-ban $35B peak
- China's DRAM import dependency 90% in 2023 despite CXMT growth
- US banned 140 Chinese chip firms from tech in Oct 2023 Entity List update
- Japan export controls on 23 tools hit Naura sales 15% in 2023
- China's NAND self-sufficiency at 15% in 2023, reliant on SK Hynix/Samsung
- TSMC halted shipments to China firms post-FBI warnings in 2023
- China's EDA software import ban workaround cost firms 20% extra in 2023
- US CHIPS Act indirectly boosted China domestic tool dev by 50% funding shift 2023
- CXMT market share stalled at 1.5% global DRAM due to tech gap 2023
- Over 300 China chip execs left for Taiwan/US in 2023 amid restrictions
- China's high-bandwidth memory import reliance 100% in 2023 for AI
- EU investigations into China chip subsidies announced Nov 2023
- SMIC's 7nm costs 40-50% higher than TSMC due to DUV limits 2023
- China's IP infringement lawsuits in semis up 200% in 2023 courts
- Global foundry capacity China share capped at 16% despite investments 2023
- US revoked licenses for Intel/AMD sales to China servers Q1 2023
Challenges and Global Trade Interpretation
The US sanctions have effectively placed China's high-end chip ambitions in a chokehold, exposing a vulnerable reliance on foreign technology while simultaneously fueling a costly and uphill battle for domestic self-sufficiency.
Investments and Policies
- In 2023, China's Big Fund invested 344 billion yuan ($47.5B) into semiconductors since 2014 inception
- National Integrated Circuit Industry Investment Fund Phase III raised 344 billion yuan in 2024 for advanced nodes
- Shanghai government allocated 100 billion yuan for chip industry from 2021-2025
- SMIC received 15.7 billion yuan subsidies in 2023 from central gov
- China's 14th Five-Year Plan targets 70% chip self-sufficiency by 2025
- Guangdong province invested 200 billion yuan in LED and chip funds 2023
- Huawei's HiSilicon R&D budget $23 billion in 2023, largest globally
- Big Fund II invested 13.2 billion yuan in YMTC expansion 2023
- Shenzhen city fund for chips 50 billion yuan launched 2023
- China's tax rebates for chip firms averaged 15% of revenue in 2023
- CASIC invested 10 billion yuan in Phytium CPUs 2021-2023
- Local gov bonds for semi parks totaled 500 billion yuan 2020-2023
- Naura received 5 billion yuan state funding for EUV tools 2023
- China's "Made in China 2025" allocated 1 trillion yuan to semis by 2025
- SMIC IPO raised 53 billion HKD in Shanghai STAR 2020, reinvested 2023
- Hubei province 100 billion yuan fund for YMTC Wuhan fab 2023
- R&D tax credits for chip design firms up to 200% deduction in 2023 policy
- CEEC invested 20 billion yuan in CXMT DRAM lines 2022-2023
- Anhui province subsidies 30 billion yuan for display chips 2023
- China's national lab budget for semi R&D 50 billion yuan/year since 2021
- Big Fund backed HuaHong expansion with 8 billion yuan 2023
- Patent subsidies up to 1 million yuan per chip IP in Beijing 2023
- Total VC investment in China chips $10 billion in 2023, down 40% YoY
- Jiangsu province 150 billion yuan integrated circuit fund 2023
- Export controls eased domestically for 100+ tools in 2023 policy
- China's university chip R&D grants totaled 20 billion yuan 2023
Investments and Policies Interpretation
China is throwing staggering sums of money at its semiconductor ambitions—a financial shock-and-awe campaign designed to buy time and a technological foothold faster than physics, geopolitics, or economic gravity can stop it.
Production and Capacity
- In 2023, China's semiconductor fabrication capacity reached 9.9 million wafers per month (8-inch equivalent), marking a 16% year-on-year increase
- SMIC's total monthly production capacity exceeded 800,000 12-inch wafers by end of 2023, with plans to expand to 1 million by 2025
- China's share of global semiconductor front-end fabrication capacity grew to 16% in 2023 from 13% in 2022
- HuaHong Semiconductor's capacity hit 1.5 million 8-inch equivalent wafers per month in 2023, focusing on power devices and sensors
- By mid-2024, China's total chip packaging and testing capacity accounted for 37% of global total, up from 30% in 2020
- CXMT's DRAM production capacity reached 120,000 wafers per month (12-inch) in 2023, with 19nm process yield over 80%
- China's NAND flash production capacity grew by 25% YoY to 1.2 million wafers/month in 2023, led by YMTC
- Total new fab investments in China announced 45 projects adding 4.8 million wafers/month capacity from 2021-2023
- Wingtech's OSAT capacity surpassed 500,000 wafers/month in 2023, making it China's largest packaging firm
- China's mature node (28nm+) capacity share hit 39% globally in 2023, driven by legacy process demand
- JCET reported 1.8 million wafers/month packaging capacity in 2023, with 15% growth from prior year
- China's SiC wafer production capacity reached 500,000 units/month by 2023, up 50% YoY
- Total China chip output volume was 385 billion units in 2023, a 12.5% increase YoY
- SMIC's Shanghai fab Phase 5 added 120,000 12-inch wafers/month for 14nm in 2023
- China's display driver IC production capacity hit 15 billion units/year in 2023, 40% of global
- Tongfu Microelectronics' advanced packaging capacity grew to 300,000 wafers/month in 2023
- China's power semiconductor capacity was 2.5 million 8-inch eq. wafers/month in 2023
- YMTC's 3D NAND fab in Wuhan reached full 150,000 wafers/month capacity in Q4 2023
- HuaHong Phase 7 fab online with 100,000 12-inch wafers/month for analog chips in 2023
- China's MEMS sensor fab capacity exceeded 1 million wafers/year in 2023
- SMIC's Beijing fab capacity at 200,000 12-inch wafers/month post-expansion 2023
- Total China discrete device production capacity 3 million wafers/month in 2023
- CR Micro's SiC capacity ramped to 20,000 wafers/month (6-inch) in 2023
- China's GaN power device capacity reached 50,000 wafers/month in 2023
- Unisoc's fab capacity for mobile SoCs at 80,000 wafers/month 12-inch in 2023
- China's CIS image sensor capacity 500,000 wafers/month in 2023, 25% global share
- CETC's legacy node capacity 300,000 8-inch wafers/month in 2023
- Total China OSAT firms capacity grew 18% to 8 million wafers/month in 2023
- SMIC's Tianjin fab added 60,000 12-inch wafers/month for 28nm in 2023
- China's RFID chip production capacity hit 10 billion units/year in 2023
Production and Capacity Interpretation
China’s chip industry is building capacity at a pace that suggests they’ve read the rulebook on sanctions and decided the correct response is to print ten million more rulebooks.
Revenue and Market
- China's semiconductor industry revenue reached 1,041 billion yuan (about $145 billion) in 2023, up 16.1% YoY
- SMIC's 2023 revenue was 52.6 billion yuan, a 19.3% increase, with 7nm contributing 10%
- Huawei HiSilicon's revenue estimated at $15 billion in 2023, driven by Kirin and Ascend chips
- China's IC design sector revenue hit 558.6 billion yuan in 2023, up 21.8% YoY
- YMTC's revenue surpassed 10 billion yuan in 2023, with Xtacking 3.0 NAND sales booming
- CXMT DRAM revenue grew 40% to 8 billion yuan in 2023, capturing 5% global market
- HuaHong Semiconductor revenue 25.4 billion yuan in 2023, up 12%, led by power ICs
- JCET's revenue reached 28.7 billion yuan in 2023, 15% growth from packaging services
- China's chip equipment market size was 380 billion yuan in 2023, up 10%
- Wingtech revenue 145 billion yuan in 2023, with OSAT segment at 60 billion
- Tongfu Microelectronics revenue 22.3 billion yuan in 2023, up 25% on advanced packaging
- China's mature node chip market revenue $50 billion in 2023, 45% global share
- Unisoc revenue estimated $4.5 billion in 2023 from mobile and IoT chips
- China's auto chip market revenue 120 billion yuan in 2023, up 30% YoY
- Naura Technology (AMAT China equiv) revenue 12 billion yuan in 2023, up 50%
- China's power semiconductor market $12 billion in 2023, 35% global
- SiCarrier (STM equiv) revenue 5 billion yuan in 2023 from SiC/GaN
- China's DDIC market revenue $8.5 billion in 2023, 50% global share
- Will Semiconductor revenue 18 billion yuan in 2023, CIS and sensors key
- China's NAND controller market $2 billion revenue in 2023, led by Maxio
- Empyrean Software revenue 1.2 billion yuan in 2023 from EDA tools, up 30%
- China's MEMS market revenue $4.5 billion in 2023, 25% growth
- Loongson Technology revenue 800 million yuan in 2023 from CPUs
- China's RFID chip market $1.8 billion in 2023, 60% global production value
- Amlogic revenue $2 billion in 2023 from TV SoCs
- China's SiC device market revenue $1.2 billion in 2023, up 60%
Revenue and Market Interpretation
While China's chip industry is galloping forward with impressive double-digit growth across nearly every segment—from SMIC's 7nm breakthroughs to dominating the mature node and power markets—it is building a formidable, self-reliant ecosystem that's less about catching up and more about securing its own technological future.
Technology and R&D
- In 2023, SMIC achieved 7nm process yield rates above 40% in volume production for Huawei Kirin 9000S
- YMTC's Xtacking 3.0 232-layer NAND entered mass production in Q4 2023 with 20Gbit dies
- CXMT began 17nm DRAM class10 production in 2023, with roadmap to 12nm by 2025
- Huawei's Ascend 910B AI chip taped out on 7nm in 2023, rivaling Nvidia A100
- SMIC developed 5nm process using DUV lithography in 2023, though yields low at <20%
- China's first 28nm FD-SOI platform commercialized by HuaHong in 2023 for IoT
- Loongson 3D5000 CPU on 12nm reached 4GHz in 2023 benchmarks
- YMTC announced 128-layer QLC NAND in 2023 with 30% higher density
- China's EUV lithography R&D achieved 3nm resolution in lab tests 2023 by Naura/others
- Phytium's FT-2000+ CPU on 7nm SMIC process launched 2023 for servers
- China's GaN-on-Si epi wafer yield exceeded 90% on 8-inch in 2023
- SMIC's N+2 (5nm class) process validated in 2023 with multi-fin transistors
- CXMT's 19nm DRAM density reached 8Gb per die in 2023 production
- Huawei Balong 5000 modem supports 5G mmWave on 7nm in 2023
- China's SiC MOSFET 1200V devices hit 95% yield in 2023 by CR Micro
- Zhaoxin x86 CPU KX-7000 on 14nm entered volume in 2023
- YMTC's 512Gb 3D NAND prototype on 238-layer announced 2023
- China's domestic EDA tools cover 80% design flows by Empyrean in 2023
- Innosilicon's 12nm AI accelerator IP licensed to 20 fabs in 2023
- China's 28nm GAA transistor prototypes demonstrated in 2023 labs
- Unisoc T820 4nm SoC for 5G launched 2023 using TSMC but domestic design
- China's MEMS IMU yield on 12-inch wafers over 85% in 2023
- Huawei Kunpeng 920 Arm server CPU updated to 7nm+ in 2023
- Maxio's MAP1602 NAND controller supports PCIe 5.0 in 2023 samples
- China's first domestic HBM2 memory validated 2023 by CXMT partners
- SMIC's 14nm FinFET poly yield improved to 70% in 2023
- China's RISC-V ecosystem chips exceeded 100 designs taped out 2023
Technology and R&D Interpretation
While perhaps not yet sprinting, China's chip industry has clearly learned to crawl at an impressively advanced technological pace, closing gaps with ingenuity wherever access to the latest tools is blocked.
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