Apple testing memory chips from China's CXMT to reduce production costs

With the rapid growth of artificial intelligence, global demand for memory chips has surged, driving up prices. In this context, Apple is testing memory chips from China's leading manufacturer, Changxin Memory Technologies (CXMT), as an alternative source to diversify its supply chain. The US tech giant is also evaluating the possibility of using these chips in iPhones and MacBooks sold in the Chinese market.

However, no final supply agreement has been reached between Apple and CXMT. The initial evaluation is focused on the feasibility of using CXMT memory chips in certain iPhone and MacBook models intended for the Chinese market. Apple's move is seen as part of its broader strategy to find alternative suppliers amid a global chip shortage and rising production costs.

AI-driven data centres and high-performance computing infrastructure require massive quantities of memory chips, placing increasing pressure on major manufacturers such as Samsung Electronics, SK Hynix and Micron. With supply failing to keep pace with demand, memory chip prices have been on the rise, impacting production costs for smartphones, computers and other electronic devices.

If Apple can use CXMT as an alternative supplier, it could gain flexibility in its supply chain and potentially secure chips at competitive prices, easing cost pressures. However, this does not mean iPhone or MacBook prices will drop directly. Instead, the move is likely aimed at countering the pressure to raise product prices due to rising chip costs.

Apple's chip sourcing from a Chinese company may face challenges related to US export control policies. Restrictions could limit Apple's ability to provide specific technical specifications or order customised chips from CXMT. The extent of any potential collaboration will depend on various technical and regulatory conditions.

HP and Acer have already used CXMT memory chips in some products sold outside the US. If Apple follows a similar path, it could add a new source to the global memory chip supply chain. Amid ongoing technology tensions between China and the US, this potential shift in Apple's supply strategy is being viewed as a significant development.