Apple Inc. (AAPL) is reportedly in talks to buy chips from two Chinese semiconductor firms on a Pentagon blacklist, as it seeks to ease the impact of a global memory shortage that has forced price increases across its product lineup.
Shares of AAPL ended the regular session on Wednesday up 1.74%, before slipping 0.15% in after-hours trading at the time of writing.
AAPL May Face Washington Scrutiny
Apple is reportedly looking to source memory components from Chinese chipmakers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Co. (YMTC) for devices sold in China, as it grapples with a global memory shortage, reported Bloomberg. Talks between Apple and the companies are said to be ongoing, and no agreement has been finalized.
The move could face political resistance in Washington, with some officials in the Trump administration reportedly opposing Apple’s efforts to integrate the firms into its supply chain. Apple CEO Tim Cook has also made appeals to administration officials, seeking to soften potential political fallout from any deal, the report said.
CXMT and YMTC are both included on a recently updated U.S. Defense Department list of Chinese entities believed to support Beijing’s military.
AAPL Seeks To Diversify Memory Chip Supply
Apple and other electronics makers are reportedly facing a shortage of memory chips. High-performance chips used in data centers require large amounts of memory, prompting suppliers to redirect production toward higher-margin AI demand.
Adding CXMT and YMTC would expand Apple’s memory supplier base to five. The company currently relies on Samsung Electronics, SK Hynix and Micron Technology for memory used across its devices. Samsung and SK Hynix have announced major investment plans, and Micron is also expanding capacity in the U.S.
AAPL Stock: What Stocktwits Retail Sentiment Says
On Stocktwits, retail sentiment for AAPL was ‘bullish,’ unchanged in the last 24 hours while message volume was ‘high.’
The has gained nearly 8% year-to-date.
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