Apple has begun testing memory chips from China's CXMT for use in iPhones and MacBooks as it looks for ways around a global shortage tied to the AI boom. The company is holding preliminary supplier talks with CXMT and needs White House approval before any deal, while federal export rules still block the kind of custom chip work Apple typically requires.
Apple has been testing memory chips made by China's CXMT for use across several product lines, including iPhones and MacBooks, the Wall Street Journal reported Sunday, citing people familiar with the matter. The tech giant is looking for ways to manage a global shortage driven by the AI boom.
The company has held preliminary discussions with CXMT about becoming a supplier to incorporate the chips into devices sold in the Chinese market, the report said. But it is seeking approval from the White House before moving forward with any deal involving the Chinese firm.
The push comes as Apple raises prices on its products worldwide, a move it has attributed to surging memory-chip costs fueled by heavy demand from AI companies. Securing a supply line from a Chinese manufacturer could give Apple additional leverage to offset those cost pressures.
Export rules still block custom orders
Federal rules bar U.S. companies from sharing technology with CXMT, including the technical back-and-forth on specifications that typically goes into producing the specialized chips Apple uses. That restriction effectively rules out custom orders from CXMT, which recently listed its shares in Shanghai and is now mainland China's most valuable listed company.
The rules do allow Apple to purchase off-the-shelf CXMT components and negotiate pricing, the report said, citing Kevin Wolf, a lawyer at Akin Gump who advises companies on export controls. Some U.S. policymakers worry that orders from major American companies would give CXMT access to U.S. expertise and additional capital, gains they fear could benefit China's military and weaken Micron Technology, which is building new plants in Idaho and upstate New York. The Pentagon has placed CXMT on a list of companies it says have ties to China's military.
CXMT still can't fully solve the shortage
For now, CXMT wouldn't fully solve Apple's supply problem. The company has maxed out its production capacity this year, leaving little room to take on new international customers, the report said. HP and Acer have already secured limited volumes from CXMT and are working to lock in larger supplies for next year, it said.
Many CXMT chips are priced in line with — and sometimes above — comparable products from Micron, SK Hynix and Samsung Electronics, the report said, a pattern driven partly by tight supply and higher production costs relative to its foreign rivals. Rising memory prices have already begun weighing on shipments of PCs and smartphones. CXMT has become the world's fastest-growing supplier of DRAM, the most common type of memory chip, with second-quarter revenue more than eight times higher than a year earlier.
Source: Investing.com
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