US Chip Curbs Force Korean Giants to Test Chinese Tech, Aiding AMEC’s Global Foothold

US Chip Curbs Force Korean Giants to Test Chinese Tech, Aiding AMEC’s Global Foothold​

The memory chip giants, Samsung and SK Hynix, are reportedly testing etching equipment from China's Advanced Micro-Fabrication Equipment (AMEC). These evaluations represent a strategic hedge against the increasing risk of stricter U.S. export controls, creating a unique opportunity for the Shanghai-based company.

While neither firm has confirmed wider deployment, these trials provide AMEC with a rare chance to secure validation from some of the world's preeminent chipmakers operating in China.The movement underscores a significant paradox within current U.S. technology control measures. Measures intended to constrain Beijing’s semiconductor ambitions are inadvertently creating openings for Chinese rivals to gain traction inside foreign-owned fabs situated in China.

Diversifying Supply Chains Amid Tightening Export Controls​

The testing of AMEC equipment began roughly two years ago, driven by mounting uncertainty over the continuation of U.S.-sanctioned chipmaking tool imports into China. The South Korean firms are utilizing these evaluations not necessarily for expansion, but as a critical contingency plan.

Sources suggest that instead of expanding manufacturing capacity in China, both companies are keeping Chinese suppliers in reserve. This move is designed to maintain and upgrade existing production lines should future restrictions restrict Western tools. Samsung operates its NAND flash memory chip plant in Xian, while SK Hynix has facilities in Dalian (NAND) and Wuxi (DRAM).

These facilities rely heavily on specialized etching tools supplied by key U.S. firms like Applied Materials and Lam Research. The current situation forces these large firms to consider alternatives beyond their established Western partners.

AMEC Seeks Stamp of Approval from Global Leaders​

Winning the endorsement of either Samsung or SK Hynix would constitute a powerful commercial validation for AMEC and China’s growing cluster of semiconductor equipment makers. While Chinese equipment developers continue to lag global rivals in advanced lithography and some inspection systems, they have narrowed critical gaps.

In areas such as etching, deposition, cleaning, and planarisation, these domestic tools are often significantly more cost-effective. Dan Hutcheson, vice chair of research firm TechInsights, noted that these Chinese tools can be 20% to 30% less expensive than comparable equipment from established foreign providers.

Furthermore, AMEC equipment is already in use by prominent Chinese chipmakers, including Yangtze Memory Technologies Co (YMTC). This existing market penetration gives Samsung and SK Hynix confidence in testing the maturity of some AMEC systems.

Market Implications for Equipment Providers​

The rise of these local suppliers poses a long-term challenge to established global equipment makers such as Applied Materials, Lam Research, and KLA. These firms have traditionally controlled key segments of the wafer-fabrication market alongside Japanese and European rivals.

Applied Materials reported $8.53 billion in China revenue for fiscal 2025, representing 30% of its total sales, highlighting the continued importance of the Chinese market. However, any breakthroughs for these Chinese suppliers face hurdles including lengthy qualification processes and potential political pressure from Washington.

Despite these challenges, U.S. export controls have clearly fostered a fertile opening for China's equipment industry. Deutsche Bank estimates that Naura Technology, AMEC, Piotech, and ACM Research will each generate over $1 billion in revenue in 2026. The bank further estimated that together, these firms could capture 25% to 30% of China’s projected $28 billion wafer-fabrication equipment market this year, potentially reaching nearly 40% when excluding lithography and metrology.