To The Moon

Apple wanted to add a new DRAM supplier to lower costs. Instead, the potential supplier reportedly refused to offer a cheaper price.

On August 5, South Korea’s Digital Daily reported that Apple had recently held procurement talks with Chinese memory-chip maker CXMT over LPDDR5X mobile DRAM. Apple reportedly asked for a further price reduction, but CXMT refused. Its quotes were said to be close to those of Samsung and SK Hynix—and, for some products, even higher. (Digital Daily)

Neither Apple nor CXMT has publicly confirmed the talks, and no specific pricing details have been disclosed.

Still, the report is not an isolated signal.

Reuters reported in July that CXMT had started raising prices for major customers including Huawei, with some DDR5 server-memory products quoted above comparable Samsung products. Apple was also seeking support from the U.S. government to gain room to purchase CXMT memory chips. (Reuters)

The real question is therefore bigger than whether Apple will eventually buy Chinese memory chips:

If even Apple is struggling to push prices lower, how far has pricing power shifted toward DRAM suppliers?

For U.S. equity investors, the two most directly affected stocks are:

$Apple(AAPL)$, which faces rising memory costs.

$Micron Technology(MU)$, the clearest U.S.-listed beneficiary of higher DRAM prices and tighter supply.

$SanDisk(SNDK)$, $Western Digital(WDC)$ and $Seagate Technology(STX)$ may also benefit from broader enthusiasm around storage, but their product exposure and pricing cycles are different. They should not be treated as interchangeable memory plays.

1. Why Does Apple Want CXMT as a Supplier?

Apple has traditionally held significant power over its suppliers.

Its orders are large, its procurement cycles are long, and it can allocate business among multiple vendors. That usually gives Apple strong bargaining power.

This memory upcycle, however, is beginning to test that advantage.

In June, Apple raised prices for selected MacBook, iPad, HomePod and Apple TV products, citing unprecedented increases in memory-chip costs. Some MacBook Air models rose by $200, while certain iPad Air models became $150 more expensive. (Reuters)

During its latest earnings call, Apple also said supply-chain flexibility had declined significantly and that it was evaluating alternative memory suppliers.

Apple has at least three reasons to consider CXMT.

1. Adding Another Source of Supply

Apple currently relies mainly on Micron, Samsung and SK Hynix for DRAM.

If CXMT passes Apple’s qualification process, it could become a fourth supplier, reducing Apple’s dependence on the three existing vendors.

2. Regaining Bargaining Power

Apple does not necessarily need to place a massive order with CXMT immediately.

The possibility of adding another qualified supplier could itself give Apple more leverage when negotiating with Micron, Samsung and SK Hynix.

But that strategy only works if CXMT is prepared to offer meaningfully lower prices.

The problem is that CXMT apparently has little interest in selling cheaply.

3. Reducing Memory-Cost Pressure

Apple Intelligence, on-device AI models and increasingly demanding applications are pushing smartphones and computers toward higher memory capacity.

Future iPhones, Macs and iPads will likely require more DRAM per device.

If memory prices and memory content per device rise simultaneously, Apple will not be dealing with a temporary cost shock. It could face sustained margin pressure over several quarters.

2. Why Can CXMT Afford to Say No to Apple?

Apple’s orders are valuable, but CXMT does not appear to be short of customers.

Reuters previously reported that CXMT had signed long-term supply agreements with customers including Tencent and ByteDance. Chinese AI-server and consumer-electronics companies are also trying to secure capacity in advance.

CXMT therefore has little reason to offer steep discounts simply to win an overseas customer.

The broader memory market is also supporting its position.

Samsung, SK Hynix and Micron are allocating more capacity, advanced packaging and research resources to higher-margin HBM and server-memory products.

The stronger the demand for HBM, the less capacity remains for LPDDR and conventional DRAM used in smartphones and PCs.

TrendForce expects conventional DRAM contract prices to rise another 13%–18% quarter over quarter in the third quarter of 2026, while NAND Flash contract prices are projected to increase 10%–15%. Although consumer-electronics demand has cooled, suppliers continue to prioritize AI and server products, leaving LPDDR supply tight. (TrendForce)

Apple is therefore facing a very different market.

In the past, memory suppliers competed for Apple’s orders.

Today, Apple is competing for access to limited memory capacity.

CXMT’s reported refusal to lower prices sends an important signal:

The new supplier is not starting a price war. It is joining the sellers that want to protect industry pricing.

3. Why Is This Most Positive for Micron?

For $Micron Technology(MU)$, one long-term risk has always been clear:

Could CXMT expand production, enter global supply chains through aggressive pricing and trigger another DRAM price war?

That concern intensified when reports first emerged that Apple was considering CXMT. Winning Apple as a customer would mean CXMT was no longer limited to Chinese buyers and could begin entering the global consumer-electronics supply chain.

The latest development reduces that concern—at least in the near term.

1. CXMT Is Not Trying to Win Market Share Through Discounts

If CXMT offered Apple prices substantially below those of Samsung, SK Hynix and Micron, incumbent suppliers could eventually be forced to respond.

CXMT’s reported refusal to cut prices suggests that this new source of supply is not yet disrupting the industry’s pricing structure.

That is particularly positive for Micron’s conventional DRAM business.

2. Micron Is Locking In Longer-Term Orders

Micron disclosed in June that it had signed 16 strategic customer agreements with data-center, consumer-electronics and automotive customers, involving approximately $22 billion in customer cash commitments and related funding arrangements.

The agreements include long-term purchasing commitments, price floors and some take-or-pay provisions. Micron expects DRAM and NAND supply conditions to remain tight beyond 2027. (Micron)

Apple’s difficulty securing lower prices from CXMT reinforces the idea that customers are shifting from asking “Who is cheapest?” to asking “Who can guarantee supply?”

3. Micron Benefits From Both HBM and Conventional DRAM

The core driver behind Micron’s rally has been HBM.

But Apple’s supplier negotiations suggest that the shortage is spreading from AI servers into smartphones, PCs and conventional DRAM.

If HBM, server DRAM and mobile DRAM all maintain strong pricing, Micron’s earnings growth will no longer depend on a single product category.

That does not mean Micron is risk-free.

CXMT is moving forward with new capacity projects. Once those facilities begin production, its DRAM output could increase substantially. If demand growth slows at the same time, the industry may once again face oversupply. (Reuters)

The report is therefore positive for Micron’s near-term pricing power. It does not eliminate the memory cycle permanently.

4. Where Is the Real Pressure on Apple?

$Apple(AAPL)$ reported revenue of $109.4 billion in its latest quarter, up 16% year over year. Gross margin reached 50.1%, although roughly two percentage points came from tariff refunds. Excluding that effect, gross margin would have been approximately 48.1%. (Apple)

Apple’s profitability remains exceptionally strong.

The problem is that memory costs are still rising.

1. Higher Prices Could Hurt Unit Sales

Apple has already raised prices for selected Macs and iPads, while the iPhone has so far been spared.

If the next iPhone generation also becomes more expensive because of higher memory costs, investors may begin reassessing replacement demand.

Raising prices can protect profit per device, but it may also weaken shipments—especially when overall consumer-electronics demand is already soft.

2. Absorbing the Costs Could Hurt Margins

If Apple decides to absorb more of the cost increase, the pressure will fall on hardware margins.

The company expects gross margin of 47%–48% for the September quarter, below the previous quarter’s level that included the tariff-refund benefit. (Reuters)

Investors now need to determine whether higher services revenue, a richer product mix and cost reductions in other components can offset rising memory prices.

3. CXMT Still Carries Regulatory Risk

Even if Apple and CXMT reach an agreement on price, Apple may not be able to begin large-scale purchases immediately.

CXMT has been added to a U.S. Department of Defense list, while U.S. officials are considering further restrictions on its access to American technology.

Apple’s reported effort to seek policy support shows that regulation remains an important variable in any potential partnership. (Reuters)

Apple is effectively choosing among three difficult options:

Accept higher prices from existing suppliers.

Raise prices for consumers.

Continue searching for alternative suppliers while taking on qualification and regulatory risks.

Every option carries a cost.

5. How Should Investors Read the U.S.-Listed Storage Chain?

Apple is reportedly discussing LPDDR5X, which is a DRAM product.

The two U.S.-listed companies most directly connected to this story are therefore:

$Apple(AAPL)$: The buyer facing higher component costs, supply-security concerns and potential product-price increases.

$Micron Technology(MU)$: A major U.S. producer of DRAM, HBM and NAND, and the most direct beneficiary of stronger DRAM pricing and supplier bargaining power.

Other storage stocks may benefit from broader sector momentum, but their underlying cycles are different.

NAND and SSDs

$SanDisk(SNDK)$: Primarily exposed to NAND Flash and enterprise and consumer SSDs. Its investment case depends on NAND pricing, not directly on higher LPDDR prices.

$Silicon Motion Technology(SIMO)$: Supplies NAND Flash controllers. Its outlook depends more on SSD shipments, NAND inventory levels and end-market demand.

HDDs

$Western Digital(WDC)$: Following the separation of its flash business, WDC is primarily focused on hard-disk drives. Its key driver is demand for high-capacity storage from cloud data centers.

$Seagate Technology(STX)$: A major supplier of high-capacity nearline HDDs. Its growth depends on rising data-center storage demand and HDD pricing—not DRAM prices.

Memory Interfaces and Storage Controllers

$Rambus(RMBS)$: Provides high-speed memory interface chips and related intellectual property. It mainly benefits from upgrades in server-memory specifications.

$Marvell Technology(MRVL)$: Has exposure to data-center storage controllers, high-speed connectivity and custom chips, making it an indirect beneficiary of AI storage and networking expansion.

Enterprise Storage Systems

$Pure Storage(PSTG)$: Provides enterprise all-flash storage systems. Investors should watch orders from AI clusters and enterprise data centers.

$NetApp(NTAP)$: Focuses on enterprise storage and cloud-data management, with revenue more closely tied to corporate IT spending.

$Dell Technologies(DELL)$ and $Hewlett Packard Enterprise(HPE)$: Can benefit from higher server and enterprise-storage demand, but they also face rising costs for components such as DRAM and NAND.

Memory-Capacity Equipment

$Applied Materials(AMAT)$, $Lam Research(LRCX)$ and $KLA(KLAC)$: These companies could benefit if Micron and other memory producers expand capital expenditure. They trade on the capacity-expansion cycle, which does not always move in sync with spot memory prices.

Apple’s reported negotiations with CXMT do not mean every storage stock benefits equally.

The most direct beneficiary of DRAM pricing remains $Micron Technology(MU)$.

$SanDisk(SNDK)$ tracks the NAND cycle.

$Western Digital(WDC)$ and $Seagate Technology(STX)$ track the HDD cycle.

$Applied Materials(AMAT)$, $Lam Research(LRCX)$ and $KLA(KLAC)$ depend more on memory manufacturers’ capital expenditure.

Separating these drivers is essential before trading the story.

6. Memory Stocks Have Already Rallied—Is It Still Safe to Chase?

The memory industry remains a sellers’ market.

But whether memory stocks are still worth chasing cannot be determined by Apple’s negotiations alone. Investors should continue monitoring three indicators.

First: The Pace of DRAM Price Increases

Continued price increases are positive for Micron’s earnings.

But if smartphone and PC manufacturers begin cutting orders aggressively, the pricing story could turn into demand destruction.

Second: CXMT’s Capacity Expansion

Tight near-term capacity gives CXMT the confidence to reject lower prices.

Once its new factories begin production, investors will need to see whether CXMT continues protecting prices or starts discounting products to win global market share.

That could determine how long the current memory cycle lasts.

Third: How Apple Passes On the Costs

If Apple can raise prices without damaging iPhone and Mac sales, it would show that consumers can still absorb higher memory costs.

If sales weaken significantly after price increases, the market may conclude that memory prices are approaching the limit of what end users can tolerate.

Higher prices are the memory sector’s biggest tailwind.

Prices rising too far are also its biggest risk.

Tiger Radar’s View

Apple’s reported attempt to secure lower prices from CXMT may look like a routine supply-chain negotiation.

In reality, it reflects a major shift in memory-industry pricing power.

Apple originally hoped that a fourth supplier could weaken the pricing structure dominated by Samsung, SK Hynix and Micron.

Instead, the fourth supplier reportedly has little interest in selling cheaply.

That suggests memory shortages are spreading beyond HBM and AI servers into smartphones, PCs and conventional DRAM.

For $Micron Technology(MU)$, the report further validates near-term pricing power. CXMT is not yet using aggressive discounts to undermine industry profitability.

For $Apple(AAPL)$, the challenge is finding a balance among higher memory costs, product-price increases and end-market demand.

For $SanDisk(SNDK)$, $Western Digital(WDC)$ and $Seagate Technology(STX)$, the news may support broader storage-sector sentiment, but investors still need to distinguish between the NAND and HDD cycles.

The story can be summarized in one sentence:

Apple hoped to use CXMT to push memory prices lower. Instead, CXMT appears to have joined the sellers’ market—positive for Micron in the near term, but longer-term risks still depend on CXMT’s capacity expansion and consumer-electronics demand.

Today’s Poll

Apple reportedly asked CXMT for lower prices and was turned down. Which U.S. stock-market thesis do you prefer?

A. Bullish on $Micron Technology(MU)$—the DRAM sellers’ market still has room to run
B. Bullish on $Apple(AAPL)$—higher costs can eventually be offset through pricing and services revenue
C. Watching $SanDisk(SNDK)$, $Western Digital(WDC)$ and other storage stocks for broader sector momentum
D. Memory stocks have already rallied too far—I would wait for a new signal from pricing or demand

What do you think? Is CXMT’s refusal to cut prices another sign that the memory supercycle is continuing—or evidence that prices are approaching the limit consumers can tolerate?

Disclaimer: This article is for market discussion only and does not constitute investment advice. Details concerning negotiations between Apple and CXMT are based on media reports and have not been publicly confirmed by either company. Please refer to official company disclosures for final procurement and pricing information.