Apple Seeks US Approval for Chinese DRAM Purchase from CXMT Blacklist
AAPL•Apple has requested US government approval to purchase DRAM from China’s ChangXin Memory Technologies, recently added to a Pentagon blacklist over alleged military ties. Loop Capital reaffirmed its Buy rating as Apple seeks local Chinese content to curb a 15–25% increase in memory costs that pushed product prices higher.
1. DRAM Sourcing Strategy
Apple is petitioning US authorities to allow procurement of DRAM from China’s ChangXin Memory Technologies to diversify its supply chain and offset rising component costs.
2. Blacklist and Risk Implications
ChangXin Memory Technologies was recently placed on a Pentagon blacklist over alleged military ties, raising potential political and reputational risks for Apple if approval is granted.
3. Impact on Margins and Pricing
Memory price inflation of 15–25% has already prompted Apple to increase product pricing, and approval of Chinese DRAM could help protect margins but may exacerbate scrutiny.
