Micron says China ban unfair but won't hurt revenue

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The products impacted by the ban are the ones that Micron sells through retail outlets and represents a small portion of the chipmaker's revenue, Morgan Stanley analysts said in a client note.

Jinhua said Micron's "unbridled behaviour" had caused "irreparable damage" to the firm and it will keep monitoring any other products that used Micron's chips.

UMC denies the allegations, and has filed to have the California case dismissed. Micron still has the right to appeal, and the follow-up of this case is bound to become the focus of the global memory industry amid the critical stage for the US-China trade war.

"UMC is pleased with today's decision".

The two chipmakers have been at loggerheads since December previous year when Micron filed a civil lawsuit in the state of California, accusing UMC of secret infringement of intellectual property related to its DRAM chips.


In January 2018, UMC and Jinhua filed patent infringement suits in Fujian Province, China against Micron's China subsidiaries.

Other semiconductor shares suffered as well on the news as the battle between Micron and China is considered a bellwether amidst a trade fight between Beijing and Washington, and China's attempt to gain advanced chip tech and knowledge.

China is the largest importer of memory products, consuming 20 percent of the world's DRAM.

Micron had earlier claimed that UMC - which is scaling up its China business and plans to list it in Shanghai - had poached key its employees to help Fujian improve its technology.

Micron Technology is rebounding after saying its temporary ban in China will have a limited impact on revenue.


"This is an opportunity for SK Hynix (000660.KS) and Samsung (005930.KS), because the banned products are not what the Chinese can make on their own".

European shares are broadly higher Wednesday, but they are losing some ground as trade tensions continue to simmer. "In the end, the Chinese court is expected to withdraw the preliminary ruling, but if Chinese chipmakers have technological power that can match that of Korean chipmakers several years from now, there will be a stronger pressure or sanction on Korean companies".

Meanwhile, Micron's ban could put pressure on Chinese companies and thus hike up the price on some domestic-made chips, said Wang Yanhui, secretary general of China Mobile Alliance, in an interview with Chinese business newspaper 21st-Century Business Herald. The country is the world's largest market for chips but China's homegrown suppliers are dwarfed by American rivals.

Analysts said the ruling would bolster Micron's well-established rivals.


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