YTMC Ban Forces Apple to Switch to Samsung For its Memory Chips

Apple encountered a brief snag in its supply chain and is seeking to overcome it by obtaining iPhone memory chips from Samsung. Initially, Apple had planned to purchase 128-bit 3D NAND flash memory from the Chinese vendor Yangtze Memory Technologies (YMTC) and utilize it in iPhones marketed to Chinese consumers. The change would have taken place as soon as this year, but the American government stepped in. According to DigiTimes, the California-based company must now rely on Samsung, one of the biggest storage memory producers in the world, to fulfill about 40% of iPhone chip orders.

By putting new orders with the Korean behemoth, Apple will be compelled to depend more heavily on its primary competitor in the smartphone market, Samsung, which currently supplies Apple with millions of screens for the iPhone 14 Pro and iPhone 14 Pro Max. Because of the more stringent export laws, YMTC is no longer allowed to provide Apple with iPhone memory chips. This was something that we had previously reported on.

Because YMTC broke the law by selling to Huawei, a phone manufacturer that is already subject to one of the toughest trade sanctions ever imposed on a technology company, the United States Department of Commerce is already investigating the company. YMTC is being investigated because it sold to Huawei, which is already subject to the sanction.

Given Samsung’s vast resources and the scale on which Apple works, the two parties may come to an agreement wherein Samsung raises production while charging its partner less because of the possible volume of chip shipments it will supply Apple. Currently, the supply chain for Apple’s iPhone memory chips includes two Japanese companies, Western Digital and Kioxia, with a Korean company, SK Hynix, handling the remaining orders. We shall learn in the future just how much Samsung can provide Apple in the next months.