China's largest DRAM maker ChangXin Memory Technologies (CXMT) will move to produce AI-focused high-bandwidth memory (HBM) HBM3E despite low yields, Reuters reported on Oct. 28 local time.

CXMT has sent HBM3E samples to Chinese AI chip design companies and will start small-scale production within 2 months, the report said. Yields are said to be 20 to 30 percent. Yield refers to the share of produced chips that pass standards. SK Hynix is at about 70 percent.

CXMT's move shows how severe the AI memory shortage is in China, Reuters reported.

Low yields typically mean more chips must be discarded or reworked, raising production costs. CXMT's HBM3E is expected to be more expensive than rivals' products. Reuters reported last month that Chinese AI chip companies such as Huawei and Cambricon raised AI chip prices by 20 to 50 percent due to memory costs.

Counterpoint Research said SK Hynix held a 50 percent share of global HBM revenue in the second quarter, followed by Samsung Electronics at 33 percent and Micron at 18 percent. CXMT ranked fourth globally with a 10 percent share of DRAM revenue over the same period. Reuters reported that it will not be easy for CXMT to narrow the gap as U.S. export controls make it difficult to secure advanced semiconductor equipment.