Bloomberg: Apple in Talks to Purchase Chips from China's CXMT and YMTC

Bloomberg reported on July 1 (local time), citing multiple sources, that Apple is seeking to purchase memory components from ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Co. (YMTC) for use in devices sold within China.
However, the sources added that negotiations are ongoing and nothing has been finalized.
If Apple proceeds with purchasing chips from CXMT and YMTC, the number of its memory suppliers would increase from the current three to five.
Apple currently relies on Samsung Electronics, SK Hynix, and Micron.
Apple CEO Tim Cook has reportedly personally requested that Trump administration officials, including Treasury Secretary Scott Bessent, mitigate potential political fallout should the deal be finalized.
CXMT and YMTC are included on the 1260H list, which designates companies that the U.S. Department of Defense claims support the Chinese People's Liberation Army.
While inclusion on this list does not entail immediate legal sanctions, it restricts contracts and research funding with the U.S. military and serves as a warning signal to U.S. investors, often viewed as a precursor to stronger trade sanctions.
Bloomberg explained that Apple does not require official U.S. government approval to purchase chips from the two companies.
However, given the heightened tensions between the U.S. and China in the high-tech sector, there is a risk of strong backlash from security hardliners in the United States.
Some officials within the Trump administration have already expressed opposition internally.
The backdrop to Apple's sensitive move is an unprecedented memory supply crunch triggered by the AI boom.
As demand for server memory, such as DRAM and NAND flash used in building AI data centers, has surged, major memory manufacturers have reduced supply for mobile devices and PCs.
On June 26, Apple raised prices across its entire product lineup, including Macs, iPads, home devices, and Vision Pro, citing the sharp rise in memory costs.
Significant political hurdles remain before any deal with the Chinese firms can be finalized.
Representative Brian Mast, Chairman of the House Foreign Affairs Committee, strongly opposed the move, stating, "CXMT and YMTC are Chinese military companies that support the Chinese Communist Party's military modernization and pursuit of AI supremacy," adding that "if this deal goes through, it will undermine the President's agenda to secure supply chains and win the AI arms race."
In particular, YMTC was also placed on a separate U.S. Department of Commerce blacklist (Entity List) in 2022, which requires separate export licenses for transactions with U.S. suppliers.
Apple previously attempted to source some memory from YMTC in 2022, but the plan was abandoned for the same reason.
(Photo: Getty Images)
※ Please note: This article was translated by AI and may contain errors.