CXMT rejects Apple's DRAM price cuts, shaking 90% memory trio

Apple's attempt to squeeze cheaper DRAM from China's CXMT failed, a sign that memory pricing power has shifted to suppliers.

Apple's bid to negotiate lower DRAM prices from China's ChangXin Memory Technologies was rejected, with the supplier insisting on pricing at or above Samsung Electronics and SK Hynix, a sign of tightening memory supply.

CXMT declined to accommodate Apple because Huawei and Xiaomi have locked in its production capacity through long-term contracts, according to South Korea's Digital Daily, which first reported the talks. "Large tech companies previously used the threat of switching to Chinese-made products as a bargaining chip, and that avenue has now effectively been cut off," the outlet said.

The rejection comes as memory suppliers tighten pricing across the board. Samsung, SK Hynix and Micron Technology have sold out their 2027 memory chip supply, with manufacturers completing most capacity-allocation negotiations for next year, tech publication Digitimes reported. CXMT, which made its market debut this week with shares surging 466 percent on the first day, is being courted by Apple as an alternative RAM supplier even as U.S. policymakers warn against its use over national security concerns.

The standoff signals that memory pricing power has shifted to suppliers, with implications for Apple's device margins and for the trio of Samsung, SK Hynix and Micron that control roughly 90 percent of the global RAM market. As capacity shifts toward high-value HBM for AI servers rather than commodity DRAM, prices for standard memory are being supported.

CXMT's Pricing Power Rests on Locked-In Chinese Demand

CXMT's refusal to discount for Apple reflects a structural change in the memory market. Chinese smartphone makers Huawei and Xiaomi have signed long-term contracts that secure CXMT's output, removing the supplier's need to court Apple's volume. The dynamic neutralizes a negotiation tactic that large tech companies have long used: threatening to shift procurement to Chinese suppliers to force concessions from incumbents.

The shift is visible in CXMT's market entry. The company, blacklisted in the United States over alleged ties to the Chinese military, has become a credible alternative source of DRAM. HP is among PC makers that have begun using CXMT memory chips, Nikkei Asia reported, even as U.S. policymakers publicly warned Apple against the supplier's use.

Memory Prices Firm as HBM Capacity Crowds Out Commodity DRAM

The pricing power extends beyond CXMT. Samsung, SK Hynix and Micron have redirected production toward high-bandwidth memory, the stacked chips that sit beside AI accelerators, leaving less capacity for commodity DRAM. SK Hynix, which holds a share in the high 50 percent range of the HBM market, reported a near sixfold jump in operating profit to a record 60.5 trillion won ($42 billion) in the quarter ended June, though the result missed forecasts of about 64 trillion won.

Micron, which has climbed to roughly a fifth of the HBM market and passed Samsung for second place, has said its high-bandwidth memory is effectively sold out well into the future. With the top three suppliers' 2027 capacity already allocated, DRAM prices are expected to stay elevated or rise as shortages persist.

For investors, the rejection is a bullish signal for memory suppliers. Samsung, SK Hynix and Micron stand to benefit from sustained pricing power, while CXMT's emergence adds a fourth force to a market long dominated by three players. For Apple, the outcome means higher component costs and compressed margins on devices using DRAM, with the company's usual bargaining power over suppliers diminished. The question is how long the tightness lasts: memory has historically swung between shortage and glut, and aggressive capacity expansion risks a future oversupply that would reverse the current pricing gains.

This article is for informational purposes only and does not constitute investment advice.