Micron Technology to Exit China Server Chip Market After 2023 Ban

People who know about the decision say that Micron Technology (MU, Financials) plans to leave China's data center semiconductor market since its business hasn't recovered from a government ban in 2023 that limited its products in critical infrastructure.

The action is the next step in the U.S.-China technology conflict that started to get worse in 2018 when the U.S. put taxes and limits on Chinese companies. Beijing targeted Micron first among U.S. chipmakers. This was considered as a response to Washington's restrictions on semiconductor exports.

Micron will continue to sell chips to Chinese customers in the automotive and mobile phone sectors and maintain relationships with companies such as Lenovo, whose data center operations are largely outside China. The firm generated about $3.4 billion, or 12% of total revenue, from mainland China in its last fiscal year.

China's ban has prevented Micron from participating in the country's expanding AI data center market, which reached 24.7 billion yuan ($3.4 billion) in investment last year. The restrictions have benefited competitors Samsung Electronics, SK Hynix, and domestic chipmakers YMTC and CXMT, all of which are expanding with government support.

Micron said in a statement it remains committed to operating in China in compliance with local regulations and continues to value the market. The company still employs more than 300 staff in its China data center division and maintains a packaging facility in Xi'an.