Micron plans to pull out of supplying memory chips to data centers in China, after failing to recover from Beijing’s 2023 ban on its products in critical infrastructure, according to two sources briefed on the decision who spoke to Reuters.
The move marks a significant retreat for the U.S. chipmaker, which generated $3.4 billion, 12% of its total revenue, from mainland China in its last business year, Reuters reported.
The company isn’t abandoning China entirely. Micron will continue selling to two Chinese customers with substantial data center operations outside China, including Lenovo, the sources said.
Plus, it will keep supplying chips to automotive and mobile phone customers in the country.
Micron told Reuters the data center division had been “impacted by the ban” and that it complies with applicable regulations of the place where it does its business.
Reuters’ review of procurement documents shows China data center investment surged ninefold to 24.7 billion yuan ($3.4 billion) last year, benefiting Samsung, SK Hynix and local makers YMTC and CXMT.
Micron’s China data center team employs over 300 people, though the job impact remains unclear.