China’s Semiconductor Industry Achieves Record $245 Billion Revenue in 2025
China’s integrated circuit industry recorded a remarkable 22% year-over-year increase, reaching a record $245 billion in revenue for 2025. This surge underscores significant growth and resilience, propelled by domestic manufacturers such as SMIC and CXMT, despite persistent U.S. sanctions. Since 2020, sales within the Chinese chip industry have nearly doubled, elevating its global market share to approximately 6%.
U.S. export controls, initially aimed at hindering China’s access to advanced technology, have paradoxically accelerated the rise of indigenous Chinese equipment vendors. These restrictions have solidified Beijing’s resolve to localize semiconductor technologies. By the end of 2025, the share of domestically developed semiconductor equipment had surged to 35%, a substantial increase from 25% in 2024. Extensive government funding and strategic policy mandates underpin this drive towards technological self-sufficiency.
Leading domestic players demonstrate this trend clearly. SMIC, China’s largest foundry, achieved a record annual revenue of $9.327 billion in 2025, marking a 16.2% year-on-year increase. Net profit attributable to shareholders also grew robustly by 39.0% year-on-year, reaching $685 million. SMIC maintained a high average annual utilization rate of 93.5% in 2025, with its 8-inch monthly wafer capacity expanding to 1.059 million by year-end.
In the memory sector, ChangXin Memory Technologies (CXMT) has shown impressive progress. CXMT’s revenue soared by 155.6% year-over-year to 61.799 billion yuan (approximately $8.6 billion) in 2025, marking its first full-year net profit of 1.875 billion yuan (around $1 billion). By the first quarter of 2026, CXMT emerged as the world’s fourth-largest DRAM maker, capturing roughly 7.67% of the global market, trailing only Samsung, SK Hynix, and Micron. The company’s monthly DRAM wafer production capacity expanded by an aggressive 47.5% from Q1 2025 to Q1 2026.
This growth is primarily fueled by robust domestic demand across various end-user industries, including 5G, artificial intelligence (AI), and new-energy vehicles. The AI chip segment, in particular, highlights significant progress in localization. Chinese companies are projected to allocate 46% of their AI accelerator budgets to domestically manufactured chips over the next 12 months, up from 30% currently. Analysts forecast that domestic AI accelerators will command nearly 90% of sales in 2026.
Despite these advancements, China’s semiconductor self-sufficiency targets remain ambitious. While the nation aims for 80% chip self-sufficiency by 2030, the actual rate in 2025 was estimated to be in the 20% range, with projections suggesting around 27% by 2027. This gap underscores ongoing challenges, yet substantial investment continues to pour into the sector. In May 2024, China launched a new $47.5 billion investment fund specifically to boost its semiconductor industry.
Moving forward, investors should closely monitor China’s sustained domestic investment policies and its relentless pursuit of technological independence. Key areas to watch include further domestic innovation in mature process nodes and advanced packaging technologies, alongside the expansion of local supply chains. The unwavering domestic market demand, even amidst geopolitical tensions, will be crucial in sustaining the growth trajectories of key players like SMIC and CXMT. The ultimate extent to which China can solidify its self-reliant semiconductor ecosystem amidst global supply chain realignments remains a critical determinant.
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