Apple Weighs Blacklisted Chinese Chips Amid Memory Cost Crunch
Apple is reportedly in talks with blacklisted Chinese chipmakers CXMT and YMTC to supply memory for China-sold devices as AI demand drives up costs.
Apple is reportedly in negotiations with two blacklisted Chinese semiconductor firms — CXMT and YMTC — to supply memory chips for iPhones and other devices sold within China, as surging artificial intelligence demand tightens global memory supplies and pushes prices higher across the industry.
The move signals a potential shift in Apple's supply chain strategy, with the Cupertino tech giant weighing cost-cutting options for its China market even as both CXMT and YMTC remain on U.S. trade restriction lists. Using components from sanctioned suppliers for products sold domestically in China is an approach that would allow Apple to sidestep some U.S. export-control implications, though it would still draw intense scrutiny from Washington policymakers.
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AI-powered features are driving unprecedented demand for DRAM and NAND flash memory, squeezing supply chains globally and forcing device manufacturers to seek alternative sourcing. Apple, which has historically relied on Samsung, SK Hynix, and Micron for its memory needs, faces mounting pressure to control component costs as consumers show heightened price sensitivity in key markets, including China — where the company battles stiff competition from domestic rivals like Huawei.
The reported talks underscore the deepening tension between Apple's global compliance obligations and its commercial ambitions in the world's largest smartphone market. Any formal supply agreement would almost certainly reignite debate in Washington over whether U.S. companies should be permitted to source components from firms placed on American trade blacklists, even indirectly through products not intended for U.S. sale.
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