Amid US Export Controls, Samsung and SK Hynix Reportedly Testing AMEC Equipment to Support Chinese Firms

As the United States continues to tighten semiconductor export controls on China, insiders reveal that Samsung Electronics and SK Hynix are assessing whether to introduce chip manufacturing equipment from China's Advanced Micro-Fabrication Equipment Inc. (AMEC) into their Chinese factories, in anticipation of further US export restrictions.

According to Reuters, citing three people familiar with the matter, the two South Korean memory giants have been testing AMEC's etching equipment for about two years. While these tests have not yet led to large-scale adoption, recognition from globally leading memory manufacturers would be a significant milestone for AMEC, headquartered in Shanghai.

More broadly, this testing underscores the contradictory effects of US technology controls: policies intended to restrict China's semiconductor development are instead creating opportunities for Chinese equipment suppliers to enter semiconductor fabs operated by foreign companies in China.

Currently, Samsung operates a NAND Flash plant in Xi'an, while SK Hynix runs a NAND facility in Dalian and a DRAM plant in Wuxi. These factories still heavily rely on etching equipment supplied by U.S. firms Applied Materials (AMAT-US) and Lam Research (LRCX-US).

Due to the sensitivity of the topic, sources requested anonymity. Samsung told Reuters it has not tested AMEC equipment at its Chinese facilities, nor is it considering doing so. SK Hynix declined to comment. AMEC and the U.S. Department of Commerce’s Bureau of Industry and Security (BIS), which enforces export controls, did not immediately respond to requests for comment.

Concerns Over Tightening Export Restrictions

In 2023, the U.S. Department of Commerce designated Samsung and SK Hynix's Chinese factories as 'Validated End Users' (VEU), allowing them to import certain controlled U.S. equipment without case-by-case export licenses.

However, the U.S. revoked VEU status in 2025 and has since issued only one-year permits, allowing the two companies to introduce chipmaking equipment into their Chinese factories through 2026.

Sources indicate that despite this, both companies remain concerned that future U.S. restrictions could extend beyond new equipment to include maintenance, servicing, and replacement parts for existing Western equipment. As a result, both are exploring Chinese equipment suppliers as a contingency plan to maintain and upgrade their existing production lines in China—without expanding local capacity.

Chinese Equipment Makers Pursuing International Certification

For AMEC and other emerging Chinese semiconductor equipment firms, certification from Samsung or SK Hynix would serve as a powerful commercial endorsement.

While Chinese equipment makers still lag behind international competitors in advanced lithography and certain inspection tools, they have significantly narrowed the technological gap in etching, thin-film deposition, cleaning, and chemical mechanical polishing (CMP). Their equipment is typically 20% to 30% cheaper than foreign alternatives.

Dan Hutcheson, vice chairman at TechInsights, said Chinese equipment is generally 20% to 30% cheaper than comparable international products.

Sources noted that AMEC’s equipment is already adopted by major Chinese chipmakers, including NAND Flash manufacturer Yangtze Memory Technologies (YMTC), giving Samsung and SK Hynix confidence that some tools are mature enough for testing.

The rise of Chinese equipment makers could, in the long term, challenge the long-standing dominance of U.S., Japanese, and European suppliers—such as Applied Materials, Lam Research, KLA (KLAC-US)—in the wafer fabrication equipment market. China remains a critical market for equipment suppliers; for example, Applied Materials generated $8.53 billion in revenue from China in its 2025 fiscal year, accounting for 30% of its total revenue.

Nonetheless, Chinese equipment makers still face challenges in achieving broad breakthroughs, including lengthy equipment validation processes, smaller after-sales service networks, intellectual property concerns, and potential political pressure from the U.S.

Moreover, it remains unclear whether Samsung and SK Hynix would introduce Chinese equipment into their domestic South Korean factories, due to lingering data security and intellectual property risks.

Nevertheless, U.S. export controls have indeed created development opportunities for China’s semiconductor equipment industry. Deutsche Bank forecasts that companies such as Naura, AMEC, Piotech, and ACM Research will all surpass $1 billion in revenue by 2026.

According to Deutsche Bank’s projections, these four firms could collectively capture 25% to 30% of China’s approximately $28 billion wafer fabrication equipment market this year. Excluding lithography and metrology equipment, Chinese suppliers’ market share could approach 40%.