Ahead of U.S. export controls on one of China's top flash chipmakers, Apple will use a different supplier for memory in its phones.
As early as this year, Apple intended to buy 128-layer 3D flash memory chips from YMTC for use in the Chinese market, with the possibility of eventually purchasing up to 40% of the chips needed for all iPhone models.
The plans were put on hold when YMTC and 30 other Chinese companies were added to an "Unverified" list by the U.S.
U.S. companies are not allowed to share any design, technologies, documents or specifications with companies on the Unverified List. Companies can be added to the U.S. export control blacklist if they can't give the necessary information in 60 days. The U.S. Commerce Department is looking into whether YMTC violated Washington's export controls when it sold chips toHuawei.
According to supply chain sources cited in the report, Apple will use SAMSUNG ELECTRONICS as an alternative supplier in the years to come.
Samsung, long the main supplier of DRAM chips for iPhones, is set to start next year supplying NAND flash for iOS devices from its plant in China's Xian plant, which now contributes 40% of the Korean vendor's total 3D NAND flash capacity, ranging from 128 to 176 layers, the sources said.
The entry into the Apple supply chain is thought to be the reason why it has not imposed production cuts. The Korean manufacturer is said to be able to afford quote cuts and output increases, which has made it more competitive.
The export controls on China imposed by the Biden administration are an effort to slow the country's technological and military advances by cutting off Beijing's supplies from certain chip made in the U.S.
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