Apple, casting a vote of confidence to CXMT?

Apple's pursuit of sourcing CXMT products is reshaping the market's positioning of this DRAM manufacturer. Citi believes that regardless of whether it ultimately receives U.S. government approval, Apple's move itself is a strong endorsement of CXMT's technical strength.

According to Zhuifeng Trading Desk, citing a June 27 report from the Financial Times via Zhongxin Jingwei, six informed sources revealed that Apple is lobbying the U.S. government to seek approval to purchase memory chips from CXMT, aiming to alleviate cost pressures from surging memory prices. In a subsequent research note, Citi pointed out that this move redefines CXMT's market image from a "Chinese domestic alternative" to a "trustworthy global fourth-largest DRAM manufacturer."

This news sends a positive signal to CXMT and its supply chain. Citi believes that the packaging and testing sector and equipment end will benefit from the increased demand for equipment and packaging and testing driven by CXMT's capacity expansion. Meanwhile, well-known Apple supply chain analyst Ming-Chi Kuo noted that Apple's real driving force behind lobbying the White House is not simply cost reduction, but a deeper structural pressure: the global memory supply gap will continue to widen until 2027.

Apple seeks policy endorsement; technical barriers are no longer an obstacle

Citi's core assessment in its research note is that Apple's willingness to consider CXMT as a potential supplier is in itself a form of market validation.

CXMT's LPDDR5X products (12Gb/16Gb die) have achieved a transmission rate of 10667Mbps, demonstrating technical capabilities that cover high-end smartphones, tablets, and laptop application scenarios. This means that CXMT's product specifications have met Apple's stringent requirements for memory performance, with technical barriers essentially eliminated.

Citi pointed out that the 1260H list itself does not prohibit U.S. companies from sourcing from CXMT, but Apple's proactive pursuit of policy endorsement is a preventative measure against potential future stricter restrictions—such as the possible expansion of the Bureau of Industry and Security (BIS) Entity List. In the current U.S. political environment, approval is far from certain, but Apple's willingness to bear this political cost itself fully demonstrates its recognition of CXMT's product reliability and the severity of the current memory shortage.

Supply gap is a deeper driving force

Ming-Chi Kuo offers an interpretation of Apple's move that goes beyond cost logic. He explicitly states that Apple's pressure has evolved from "soaring memory prices" to "widening supply gap," which are fundamentally different in nature, with the latter being harder to resolve through price increases or supplier changes.

According to his latest industry research, memory capacity allocated to consumer electronics in 2026 is expected to see 15% to 20% shifted to data centers by 2027, and this proportion may further increase. As AI infrastructure construction continues to absorb high-end memory capacity, the supply share available for consumer electronics is systematically shrinking.

This trend has already begun to affect Apple's product rhythm. Kuo indicates that due to tight LPDDR memory supply, actual shipments of Apple's A20 chip from the second half of 2026 to the first quarter of 2027 may be 10% to 20% lower than originally planned, though some of this may also reflect Apple's own overbooking.

Supply chain may benefit

Citi believes that the market repricing brought about by CXMT's endorsement from Apple will transmit along the supply chain to upstream equipment makers and packaging and testing companies. In the packaging and testing field, Citi has recently raised target prices for three domestic packaging and testing firms to reflect an overall sector valuation re-rating.

Whether CXMT ultimately secures Apple's purchase orders still depends on U.S. government policy direction. But this "vote of confidence" alone is enough to change the market's narrative framework for CXMT.

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