Samsung SSD 860 Pro internal board, August 25, 2018. File photo, not the China factory upgrades or their new products. Michael Bemmerl / Wikimedia Commons · CC BY 3.0 DE. Display crop.
By E.K.K
Samsung and SK hynix are working on their memory-chip factories in China without a publicly announced blanket relaxation of U.S. technology restrictions. Manufacturers need to renew their production lines; access to equipment remains subject to licensing. For Asian customers, the outcome matters because it helps determine which products those factories can supply.
In responses to Reuters, Samsung confirmed upgrades and SK hynix described equipment installation at Dalian, both in consultation with Washington. Those interview responses do not establish that every required approval has been issued.
More storage does not always mean more wafers
NAND flash preserves data when power is switched off. It serves a different purpose from the processors that perform AI calculations, even though both can be used in the same data center.
Stacking storage cells in more layers can increase the amount of information held within a given area. Samsung's published ninth-generation V-NAND specifications describe higher density, while SK hynix has announced products exceeding 300 layers. These company disclosures establish an ongoing technology transition, not authorization to reproduce each process at a Chinese location.
A factory's wafer throughput and its output of usable storage capacity are different measures. A process conversion can change the latter without adding another building. Conversely, a new process may take time to deliver its expected benefits. Neither a construction announcement nor a headline layer count establishes stable commercial output.
The missing information is in the licenses
In August 2025, the Bureau of Industry and Security ended a licensing exemption for selected foreign-owned semiconductor fabs in China. It said future approvals were intended to sustain existing operations rather than expand capacity or upgrade technology.
The apparent tension between that position and current factory work cannot be resolved from public statements alone. The equipment involved, its permitted use and any attached conditions matter. It would be premature either to declare a policy reversal or to accuse the companies of violating the rules.
That distinction also matters for policy assessment. Keeping a factory operational, replacing equipment and authorizing a new production capability are not interchangeable descriptions. A useful explanation needs to identify what has actually been approved.
What customers should watch
For manufacturers, leaving established plants on older processes could weaken their commercial position. Modernization, however, brings execution costs and regulatory uncertainty. Existing capital cannot simply be moved elsewhere whenever policy changes.
Asian storage-device makers and server suppliers face a more practical question: will qualified products arrive on time? A nominally attractive product is less useful if delivery schedules remain uncertain or an alternative supplier is unavailable.
Successful conversion could widen customers' options. Delays could require changes in inventories, product mixes or sourcing locations. Neither scenario justifies a confident forecast about retail device prices from the information currently available.
The next milestones are clarification of approvals, demonstrated production progress and customer qualification. Equipment installation, trial production and sustained shipments are separate stages. The effects of export controls will become clearer as those stages advance—or fail to advance.
Sources
Reuters company responses, October 21, 2026
BIS policy announcement, August 29, 2025
Samsung ninth-generation V-NAND