Apple tests Chinese CXMT memory chips for iPhones amid global shortage

Tech giant Apple is reportedly in the process of testing memory chips made by Chinese company CXMT across its lineup of devices, including in iPhones and MacBooks, as it looks at options to address the shortage of memory chips.

The strategic evaluation comes as the rapid expansion of artificial intelligence infrastructure tightens global supplies of DRAM and other memory products, putting intense pressure on the consumer electronics industry's supply chain. According to reports, Apple has held preliminary discussions with CXMT about potentially sourcing memory specifically for devices sold within the Chinese market.

Media additions

The potential partnership highlights how supply crunches are forcing major device manufacturers to reconsider their component sourcing. As memory production is redirected toward heavy-duty AI data centers, traditional electronics makers face shrinking allocations. Apple has raised prices on its products in markets around the world, which it has attributed to surging memory chip costs amid a shortage caused by demand from artificial intelligence (AI) companies.

Yet tapping CXMT comes with formidable regulatory and operational hurdles. Apple is hoping to receive approval from the White House for the arrangement. The collaboration faces severe scrutiny under U.S. Export controls and rules that aim to block American firms from transferring sensitive technology and data to Chinese companies.

Current restrictions permit Apple to purchase off-the-shelf components from CXMT, but they strictly prohibit ordering custom chips built to the company's precise technical specifications. Consequently, if the arrangement moves forward, Apple may be forced to redesign parts of its products sold in the Chinese market to accommodate standard CXMT chips rather than customized alternatives.

Geopolitical complications do not end with regulatory hurdles. CXMT is listed on a Pentagon roster due to links with the Chinese military, indicating direct or indirect affiliation with the Chinese government's Ministry of Information Technology, alongside links to an agency that oversees state-owned enterprises.

Despite these challenges, other laptop makers have already begun testing or utilizing the Chinese supplier's hardware. HP and Acer have obtained limited quantities of memory chips and are looking to lock in additional supplies for next year, the Journal reported.

Market Realities and Capacity Constraints

While Apple evaluates CXMT to diversify its sourcing beyond established players like Micron Technology, SK Hynix, and Samsung Electronics, the Chinese firm may offer limited near-term relief. CXMT has reportedly reached its planned production capacity, leaving little room to accommodate major new overseas customers.

The company is currently prioritizing domestic tech companies in China. Furthermore, its chips are not necessarily cheaper; prices have reportedly reached levels comparable to or even exceeding products from established international memory suppliers.

At the same time, CXMT continues explosive growth. The firm stands as the largest chipmaking company in China based on market value and has emerged as the world's fastest-growing supplier of DRAM memory chips. Its second-quarter revenue increased more than eightfold, while its global DRAM market share reached 7% according to research data cited in the reports. CXMT is actively investing in additional manufacturing capacity—including consideration of a second memory chip plant in Beijing—with ambitions to more than double its current production capacity.

Broader Market Pressures

The wider technology sector continues to grapple with the fallout of the memory crunch. Broader electronics markets have seen significant downturns as component expenses mount, with worldwide PC shipments falling year over year in the second quarter, alongside double-digit declines in smartphone shipments.

These supply pressures form part of a wider period of market volatility across the business landscape, intersecting with broader trends affecting semiconductor equities and global tech shares. The current testing phase represents exploratory supply flexibility for Apple rather than a confirmed commercial agreement or an immediate replacement for existing suppliers. The ultimate outcome will depend heavily on chip performance, commercial terms, supply availability, and the evolving regulatory environment.

What to Watch Next

• Decisions from the White House regarding whether Apple will receive regulatory approval for the arrangement.
• Future production milestones as CXMT works toward its goal of doubling output capacity by 2028.
• Potential product redesigns for Apple devices tailored specifically for the Chinese market to utilize standard, off-the-shelf components.
• Further commercial developments involving other major consumer electronics brands securing regional memory allocations.