White House Blocks Apple's Chinese Memory Chip Deal Amid National-Security Concerns
The memory-chip market has experienced a surge in prices due to AI-fueled demand. Memory chip prices have increased by 500% over the past year, with random-access memory (RAM) being a key driver of this trend. RAM is used in data centers and computer systems to temporarily store data.
The shortage has driven massive gains in memory stocks, including Sandisk, Micron Technology, Western Digital, and Seagate Technology. However, this has put pressure on PC and smartphone makers, who are forced to make do with what memory chips they can find due to the shortage.
Apple was put in a tight spot after being told by the White House not to buy memory chips from China's top RAM manufacturer, ChangXin Memory Technologies (CXMT). CXMT has been listed as a national-security risk by the Pentagon and is currently on the Chinese Military Company Blacklist. Commerce Secretary Howard Lutnick urged Apple to find 'other solutions' to the memory issue.
The White House's decision has sparked a rally in U.S. memory-chip stocks, with Sandisk and Micron Technology jumping hundreds of percent this year. The government's willingness to enforce artificial scarcity has propped up domestic chipmakers, but it means RAM prices will stay higher for longer.