China's semiconductor industry has witnessed a historic moment. Just 17 days after listing on the Shanghai Stock Exchange, memory manufacturer CXMT surpassed internet giant Tencent in market capitalization, becoming China's most valuable listed company.
As of this week, CXMT's market capitalization reached $524 billion, while Tencent's stood at $511 billion. Although CXMT's stock price dipped slightly by 1.2% on the day, its surpassing of Tencent was mainly due to Tencent's further stock decline after releasing its second-quarter financial report. Tencent's report showed a 176% surge in capital expenditure for AI infrastructure, sparking market concerns about the payback period for such massive investments, leading to a 5.34% drop in its US-listed shares, with a year-to-date decline of 26% as of 2026.
Tencent itself is a customer of CXMT, with both parties signing a $3 billion server DRAM supply agreement in June. Additionally, CXMT signed a five-year server DRAM contract worth over $7 billion with ByteDance in July. The market seems to be voting with its feet, believing that hardware suppliers can benefit more directly and stably in the current AI race.
CXMT's listing itself set records. On July 27, its stock price surged 466% on the first day of its IPO, raising $8.6 billion, with retail subscription oversubscribed by 212 times. The company's performance also supported its stock price: amid ongoing memory chip shortages and rising prices, CXMT achieved an operating profit of 35.43 billion yuan (about $5.2 billion) in the first quarter, compared to a loss of 2.83 billion yuan in the same period last year.
Despite its soaring market position, analysts hold vastly different views on its valuation. Nomura Securities set a target price of 116 yuan, suggesting room for further stock price growth; meanwhile, Morningstar's fair value estimate is only 14.90 yuan, considering the current stock price to be more than four times its reasonable valuation.
CXMT held a 7.67% share of the global DRAM market in 2025, with its market capitalization approaching half that of Micron (about $1 trillion) and reaching approximately 60% of SK Hynix's ($880 billion). The company is ambitious, planning to build its sixth mega-fab and aiming to increase its DRAM market share to 30% by 2030.