Why Is Apple Leading 'China Semiconductor Rising'?

A book that has recently become a major topic of discussion among semiconductor academia, securities analysts, and journalists is "China Semiconductor Rising" by Professor Kwon Seok-jun of Sungkyunkwan University. As a researcher of next-generation semiconductor materials and processing technologies, he empirically presents the current state of China's so-called "semiconductor rise" from a broad perspective. The book prompts deep reflection on what kind of response strategy South Korea should adopt. Coincidentally, not long after this book was published in April 2026, a series of unusual developments have emerged in the global semiconductor industry. These are signs of jealousy and containment directed at South Korea's semiconductor industry, which holds a dominant position with a 68% share of the memory market. The stagnation of the domestic stock market, which had been driven by the rising stock prices of the top two semiconductor companies, is not unrelated to these environmental changes.

Apple is reportedly lobbying the Trump administration, including the U.S. Department of Commerce, to approve its purchase of Chinese memory semiconductors. Following this, foreign media reported that Apple is specifically testing memory chips from China's ChangXin Memory Technologies (CXMT) for use in products like the iPhone. This appears to be a multi-purpose strategic move made at a time when the rising cost of DRAM has increased manufacturing cost burdens for smartphones, laptops, and iPads. However, many predict that it will be difficult for the U.S. government to actually grant approval. Since deciding to block the supply of Chinese semiconductors to the U.S. government through the National Defense Authorization Act (NDAA) four years ago, U.S. companies have refrained from importing Chinese memory semiconductors in bulk. Major Chinese semiconductor companies are listed on the U.S. Department of Defense's "Chinese Military Companies" (Section 1260H) list. If transactions of high-specification semiconductors begin in earnest, there is a possibility that the U.S. Department of Commerce could completely ban the import of commercial Chinese chips that were previously traded. In reality, legacy semiconductors of 28 nanometers or more, which are used in automobiles and home appliances, have already captured a significant portion of U.S. demand, armed with cost-effectiveness. It is also understood that a substantial volume of these Chinese legacy semiconductors is being exported to the United States indirectly through routes such as Hong Kong and Vietnam.

In the case of Apple's iPhone, components include application processors (APs), DRAM, and NAND flash. Except for the AP, data storage memory like DRAM and NAND is sourced from Taiwan and South Korea. While chips from China's CXMT are not significantly cheaper, they align with the goal of maintaining product pricing by substituting for supply shortages. However, because it is difficult to predict the reaction of global iPhone consumers who are highly sensitive to quality and performance, and because the results of applying these chips to products have not been 100% verified, the dominant analysis is that it is difficult for Apple to realize this immediately. If so, Apple's primary objective is highly likely to be a containment and pressure tactic to secure price bargaining power in the process of importing South Korean semiconductors. Furthermore, there is a strong suspicion that Apple's underlying intention is to appeal to the U.S. government about the difficulties it faces due to high semiconductor prices, thereby prompting a trade-level response.

Looking back at history, there are suspicions that Apple, which prides itself on being a multinational corporation, may be hiding an intention far more significant than merely putting price pressure on the South Korean and Taiwanese semiconductor industries. In his book, Professor Kwon describes how major U.S. tech companies, of all things, were behind China's semiconductor and AI industries reaching their current levels. Last year (2025), an investigative report titled "Apple in China" written by journalist Patrick McGee of the UK's Financial Times caused a significant stir in U.S. political circles by reporting how U.S. capital and big tech companies like Apple had, over a long period, provided substantial assistance to China's high-tech industries while doing business there.

Looking at the status in 2024, 17% of Apple's total revenue was generated in China, with iPhones generating up to 25% of their revenue there. To reduce costs by manufacturing iPhones and MacBooks in local Chinese factories, Apple initially cooperated with Taiwanese IT firms and partnered with local Chinese manufacturers for final assembly. Over time, this resulted in Chinese companies taking over most of the manufacturing processes.

During this process, significant advanced technology and equipment were reportedly provided to Chinese companies. What is particularly noteworthy is that, going beyond Apple itself, there are numerous indications that semiconductor and display technologies from other countries supplying components to Apple were transferred to China through Apple. The same applied to the technologies of major South Korean companies within the Apple ecosystem. It is already an open secret that Apple, which reaps massive profits in the Chinese market, has largely responded to the needs of both the Chinese industry and the Chinese government. The close symbiotic relationship between Apple and China raises serious suspicions that Apple's latest move goes beyond a simple pressure tactic and is aimed at creating an opportunity for Chinese DRAM semiconductors to enter major markets.

Micron Technology, a U.S. semiconductor company that shares the DRAM market in a three-way split with Samsung Electronics and SK Hynix, broke ground early this month (July 2026) on a new factory in Hiroshima, Japan, to expand production of next-generation DRAM and high-bandwidth memory (HBM). While Japan's Kioxia produces NAND flash memory, Japan has had virtually no manufacturing base for DRAM since Elpida Memory closed 24 years ago after losing out in competition with the United States. Once Micron's Hiroshima plant begins production in three years, Japan is expected to join the AI semiconductor export race by rebuilding its semiconductor production network from front-end to back-end DRAM processes.

The Nihon Keizai Shimbun (Nikkei), which reported on Micron's Hiroshima plant in detail, gave prominent coverage two days later to South Korea's Samsung Electronics recording its highest earnings for three consecutive quarters, with noteworthy content. "Samsung Electronics is enjoying such a boom that it is on track to earn more total profit within this year than the cumulative amount it has made over the 40-odd years since it entered the business in 1983," the newspaper projected, highlighting the crisis situations Samsung will face in the future. It pointed out that U.S. consumers have filed class-action lawsuits claiming damages from "price-fixing" by memory semiconductor companies, and raised concerns about trade issues arising from market monopolization.

Such reporting by a leading Japanese media outlet reflects the victim mentality of the Japanese industrial sector regarding semiconductors—specifically, the perception that South Korea and Taiwan snatched away Japan's semiconductor boom of the 1970s and 1980s. In the past, Japan used its price competitiveness to wither Intel of the United States, the pioneer of semiconductors. In response, the Reagan administration pointed out the "dumping" of Japanese semiconductors and applied all-out pressure, including imposing a 100% tariff on Japanese-made consumer electronics. Ultimately, Japan lost its price-setting power through the 1986 U.S.-Japan Semiconductor Agreement and had to yield to pressure to guarantee up to a 20% market share for U.S.-made semiconductors in Japan. The market previously held by Japanese semiconductors was consequently replaced by the rapidly growing Taiwanese and South Korean semiconductor industries. Nikkei pointed out that "just as Japan experienced in the past, the U.S. Trump administration could once again squeeze the South Korean semiconductor industry through trade pressure such as tariffs," which is a scenario that South Korean semiconductor companies also inwardly fear. Domestic experts suspect that Japan, in attempting to revive its own semiconductor industry, is invoking the past U.S.-Japan Semiconductor Agreement to check South Korea. By aligning closely with the United States through semiconductor supply chain sharing, Japan is suspected of inducing U.S. trade pressure on South Korea.

China's ChangXin Memory Technologies (CXMT) has announced its listing on the Shanghai stock market within this month (July 2026). Yangtze Memory Technologies (YMTC) is also pushing for a listing within this year (2026). The IPOs of these two companies representing Chinese semiconductors are strongly intended to increase production facility investment through large-scale fundraising and attempt to export memory semiconductors to the global market. Although the United States still adheres to regulations on Chinese semiconductors, the growing inflationary pressure amid rising costs due to skyrocketing prices is bound to be a significant burden. Based on the aforementioned cooperation with Apple, China is increasing its bargaining power against the United States through the supply of strategic materials such as rare earths and a strengthened international network, raising cautious possibilities of a shift in the landscape.

While Chinese semiconductors are growing with full policy support from the Xi Jinping administration, they lag somewhat behind in developing HBM required for AI, as the first Trump administration banned the export of extreme ultraviolet (EUV) lithography equipment—essential for advanced semiconductors—to China in 2019. However, CXMT's DRAM wafer production is already estimated to have exceeded 40% of Samsung Electronics' level, and YMTC's NAND flash production is closely chasing SK Hynix. Domestic experts evaluate the technology gap between South Korea and China regarding advanced semiconductors to be around three years.

Japan, dreaming of a semiconductor industry revival through close alignment with the United States, and China, aiming to join the global supply cycle through production expansion, are effective pressure cards that the Trump administration—which is envious of South Korea's DRAM production capacity—can utilize depending on the situation. Once the Middle East war phase winds down, Trump, seeking to achieve results in trade policy ahead of the November midterm elections, is highly likely to turn his gaze toward South Korea's semiconductors. Trump has pursued a strategy of weaponizing tariffs to pressure Asian semiconductor companies to build factories on U.S. soil. For Taiwanese and South Korean semiconductor companies, as they generate stronger earnings amid increased demand, the burden of containment, including trade pressure, is also growing.

Under the current circumstances, since South Korea holds the initiative in memory semiconductors within the global supply structure, the key is to appropriately maintain the vulnerability of the United States, which relies on imports. Rather than hastily expanding local production facilities in the U.S., South Korea needs to first complete the semiconductor clusters under construction in Yongin and Pyeongtaek, Gyeonggi Province, to strengthen its position as a primary semiconductor supplying nation. The most crucial task is the flawless protection of core proprietary technology assets. At a time when the long-standing efforts of the industry have allowed South Korea to preemptively secure a "choke point" (strategic stronghold) position in the AI era, a smart response is urgently needed.

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