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Apple Has Put Plans To Use China's YMTC Chips On Hold: Reports

Apple Has Put Plans To Use China's YMTC Chips On Hold: Reports
According to the Nikkei, Apple Inc has put plans to use memory chips from China's Yangtze Memory Technologies Co in its products on hold after Washington tightened export controls against Chinese technology companies.
According to Nikkei, Apple had originally planned to begin using state-funded YMTC's NAND flash memory chips as early as this year. The chips were originally intended to be used only in iPhones sold in China.
According to the newspaper, the company was considering purchasing up to 40% of the chips required for all iPhones from YMTC in the future.
Analysts believe that YMTC is one of the smaller companies that supplies memory chips to Apple, and that the move will have little to no impact on it.
The bigger implication, according to CFRA Research analyst Angelo Zino, is that it prevents Apple from potentially further diversifying its supplier base by utilizing domestic Chinese players and improving its cost profile over time.
Apple is shifting more production to Vietnam and India to make products such as the AirPods and new iPhones.
In pre-market trading, Apple shares rose 1.6% to $140.59, tracking broader market gains.
Last week, the US added China's top memory chipmaker YMTC and 30 other Chinese entities to a list of companies that US officials have been unable to inspect, escalating tensions with Beijing and triggering a 60-day clock that could result in much harsher penalties.
The Biden administration's sweeping set of export controls on China is an attempt to stifle Beijing's technological and military advances by cutting off the country's supply of certain semiconductor chips manufactured anywhere in the world using US equipment.
There were no comments from Apple and YMTC on the issue.

Christopher J. Mitchell

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