Montage Tech Stock Drops Over 9% on South Korean Antitrust Probe

Shares of Montage Technology plunged 9.3% on Friday after the Chinese memory chip maker disclosed it is the subject of an antitrust investigation in South Korea, a critical market that accounts for more than half of its annual revenue.

Probe Overshadows Strong Outlook

Montage revealed that prosecutors from the Seoul Central District Prosecutors’ Office conducted an on-site search and evidence collection at its Korean offices, according to a report from Investing.com. The probe is examining potential violations of South Korea’s fair trade laws related to alleged price collusion in semiconductor components.

The market reaction was severe due to the company's heavy reliance on the region. South Korea accounts for approximately 53.6% of Montage's annual revenue, with major customers including industry giants Samsung Electronics and SK Hynix. The investigation introduces significant legal and financial uncertainty, which investors weighed more heavily than the company's strong operational performance.

Positive Fundamentals Ignored

The sell-off largely eclipsed a positive profit alert issued by the company. Montage projected its net profit for the first half of 2026 would be between RMB 1.9 billion and RMB 2.1 billion, a year-over-year increase of 63.9% to 81.2%. This growth was attributed to surging demand for its DDR5 memory interface chips, which are crucial for AI infrastructure.

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In a further sign of confidence, Montage also proposed a share buyback plan of RMB 300 million to RMB 600 million. However, these positive developments were not enough to offset investor concerns about the potential impact of the antitrust probe.

Broader Context

The investigation appears to extend beyond Montage. The Korean offices of the company’s two closest global rivals in the memory interface chip market, Japan’s Renesas Electronics and U.S.-based Rambus, were reportedly targeted in the same raid.

Montage's stock decline also occurred amid a broader downturn in the Hong Kong market, where technology and chipmaking stocks fell. Globally, semiconductor stocks have faced pressure recently on concerns that an AI-fueled rally had led to stretched valuations.