On August 6, a piece of news drew the industry’s attention: Apple sought to negotiate a lower DRAM procurement price with ChangXin Memory Technologies (CXMT), only to receive a firm rejection. CXMT insisted its quotations could not fall below those of Samsung Electronics and SK Hynix, and might even be higher.
There was a time when “securing a spot in Apple’s supply chain” was the aspiration of countless suppliers, as it promised stable, large-volume orders. Today, however, CXMT has said “no” to Apple and pushed back with a higher price tag.
Where Does CXMT's Confidence Come From? First, it stems from backing by the domestic market. Firms including Huawei and Xiaomi have locked in CXMT’s production capacity via long-term contracts. Supported by massive, steady domestic orders, CXMT has no need to concede to Apple’s stringent terms. Apple’s past tactic of shifting orders to Chinese suppliers to force price cuts has now lost its traction.
CXMT’s prospectus also discloses that the company has partnered with core industry customers such as Tencent, Alibaba Cloud, ByteDance and Lenovo. Reports show that CXMT signed a supply agreement worth more than $3 billion with Tencent in June this year, followed by a five-year supply deal valued at over $7 billion with ByteDance in July. The certainty and scale of domestic demand orders have built CXMT’s first competitive moat.
Second, the memory chip market has shifted into a seller’s market, with pricing power moving upstream. Zhang Guobin, a senior semiconductor industry expert, notes that fueled by explosive growth in AI computing demand, Samsung and SK Hynix are diverting more than 70% of their new capacity toward high-value AI memory products such as HBM4 and enterprise SSDs. This has steadily tightened supply for general-purpose DRAM including LPDDR5X. Within this seller’s market, pricing power across the memory sector has shifted from downstream device makers to upstream original manufacturers.
At its core, this confidence is rooted in CXMT’s own progress. CXMT’s product specifications and yield rates have now reached the first tier. Its 17nm DDR5 yield has surpassed 90%, trailing the same-generation Samsung products (92%–93%) by only a few percentage points. Its LPDDR5X supports a peak data rate of 10667 Mbps and has entered the supply chains of Xiaomi, HONOR, OPPO, vivo and Transsion. This track record has helped Apple validate CXMT’s mass-production capability and long-term supply reliability.
CXMT’s cost advantage further creates negotiation room. Zhang Guobin states that CXMT’s per-wafer manufacturing cost is 15%–20% lower than that of South Korean peers. This allows CXMT to maintain healthy margins while keeping prices at or above the levels offered by Samsung and SK Hynix.
CXMT is no longer merely a “low-cost alternative.” It has grown into China’s largest, most technologically advanced and comprehensively deployed integrated DRAM firm covering R&D, design and manufacturing. In Q1 2026, CXMT captured 7.7%–8% of the global DRAM market share, ranking first in China and fourth worldwide.
Its production capacity is also substantial. CXMT operates three 12-inch DRAM wafer fabs in Hefei and Beijing, with a monthly capacity of roughly 280,000–300,000 wafers and capacity utilization consistently staying above 95%. Monthly capacity is projected to rise to around 350,000 wafers by the end of 2026.
In fact, Apple’s active lobbying of the U.S. government to secure approval for purchasing CXMT DRAM for devices sold in the Chinese market is clear proof that it has recognized that amid memory shortages, CXMT is a strategic supplier that must be engaged on an equal footing.
At this stage, it is not CXMT that cannot afford to lose Apple; rather, Apple has greater need for CXMT.
Terminal Manufacturers Collectively "Push for the High-End" Surging memory chip prices are rippling through the global consumer electronics supply chain with unprecedented force. TrendForce data shows that in the first half of this year, retail prices for 16GB DDR5 memory modules and 1TB SSDs both rose more than 130% year-on-year versus 2025. Goldman Sachs, TrendForce and other institutions unanimously forecast that the current tight supply-demand balance in the memory market will persist until at least the second half of 2027.
These price hikes have fully passed through to end consumers. In March this year, OPPO took the lead, raising prices for its A-series and K-series phones by RMB 200–500. vivo and HONOR followed shortly after. Come June, brands including OnePlus and iQOO rolled out a second round of price increases. Since the start of the year, mainstream smartphone brands have implemented multiple pricing adjustments, with cumulative hikes of RMB 300–1,000 common for mid-range and entry-level models.
On August 5, Richard Yu, Chairman of Huawei’s Consumer Business Group, remarked that steep memory price inflation may force broad-based price increases for smartphones going forward; otherwise, devices sold at original prices would be unprofitable. IDC analyst Guo Tianxiang points out that low-cost inventory materials purchased by manufacturers in earlier periods are gradually depleting, and cost pressures will surface concentratedly in the second half of the year.
Zhang Guobin expects rising memory costs to drive four major structural shifts across the smartphone industry. First, a shift from volume-led growth to price-led growth: IDC forecasts that China’s smartphone shipments may post a notable decline in 2026. Industry growth will no longer depend on expanding shipment volumes, but on higher average selling prices (ASP). Second, a shift from high-volume low-end offerings to high-end breakthroughs: As memory prices climb, leading vendors are trimming entry-level and mid-tier product lines and concentrating resources on premium and flagship models to absorb cost pressure. This makes 2026 a pivotal year for domestic Android brands to advance into the high-end segment. Third, a shift from hardware profitability to service-driven value addition: Manufacturers are compelled to reshape their business models from selling hardware to delivering services. Key avenues include in-house chip development, system-level power optimization, and replacing local storage with cloud computing resources. Fourth, a shift from consumer-electronics-driven demand to AI-compute-driven demand: This cycle is no longer powered by smartphone replacement demand. Instead, it is fueled by the voracious appetite of AI servers for HBM and DDR5.
Six Forward-Looking Steps: How CXMT Can Cope with the Downward Cycle Memory chips remain a highly cyclical industry. In 2027, new capacity from Samsung, SK Hynix, Micron and CXMT will come online en masse. Should growth in AI infrastructure investment slow, the DRAM market could be the first to enter a downturn. Some analysts even project year-on-year negative growth for memory chips in 2027.
Independent ICT analyst Sun Yongjie observes that Samsung, SK Hynix and other players are pouring resources into HBM while gradually de-emphasizing the DDR market. This opens a golden window for CXMT, which has long focused on DDR. This opportunity is not a differentiated advantage CXMT built by design; it is a market opening created by competitors’ strategic pivots. Domestic memory vendors must therefore sustain long-term investment to build durable moats.
Faced with the upcoming downturn, Zhang Guobin recommends that CXMT and other domestic memory players lay groundwork across six dimensions. First, optimize high-end product mix. Accelerate migration from DDR4 to DDR5 and LPDDR5X to lift product ASP. Further raise the share of HBM capacity from its current level of roughly 20%. This requires smooth commissioning of CXMT’s Shanghai HBM packaging and testing fab by the end of 2026, closing the verification loop for HBM3 from sampling to stable mass production. Second, lock in major customers via long-term agreements. Secure core demand from Huawei, Xiaomi and other partners through long-term agreements (LTAs) to smooth cyclical volatility. Meanwhile, complete quality certifications for key international customers during the upcycle, positioning the company to capture market share when the market hits its trough. Third, pursue aggressive cost reduction and narrow technology gaps. Push toward sub-15nm process nodes, boost yield rates and close the process-generation gap with the three overseas memory giants (Samsung, SK Hynix and Micron). Leverage domestic equipment adoption (targeting over 60% localization) to cut capital expenditure and operating expenses. Fourth, pursue diversified deployment. Target niche markets with milder price swings and higher certification barriers, such as automotive-grade, industrial-grade and enterprise-grade SSDs. At the appropriate time, add NAND flash or CXL controller chips to evolve into a full-spectrum memory solution provider. Fifth, implement flexible capacity management. Adopt the “keep high-margin lines and phase out low-margin ones” strategy used by the three overseas memory giants. Prioritize cutting capacity for low-margin products during market downturns. Sixth, cultivate system-level competitiveness. Forge deep ties with domestic AI accelerator chips including Huawei Ascend and Cambricon, building an independent ecosystem centered on “storage-computing synergy.”
2028: Domestic HBM Reaches the Implementation Turning Point China’s memory industry has built up meaningful competitive advantages. For instance, CXMT and YMTC (Yangtze Memory Technologies Co., Ltd.) have developed proprietary technology stacks based on G4/G5 processes and the Xtacking 4.0 architecture respectively, effectively circumventing overseas patent barriers. Monthly capacity has delivered scale benefits, and long-term agreements are in place with domestic leaders such as Huawei Ascend, Xiaomi and OPPO. Across the supply chain, equipment localization has exceeded 45%, with suppliers including NAURA and AMEC forming a collaborative ecosystem.
Nevertheless, obvious gaps remain against global leaders in high-end segments. Advanced process nodes, advanced packaging, high-end lithography tools and core materials are still bottlenecks. Weak patent portfolios and geopolitical hurdles also constrain global expansion.
Zhang Guobin laid out a clear timeline for HBM mass-production maturity. Late 2026 to early 2027: CXMT launches small-batch HBM3 trial production, and the Shanghai packaging and testing fab goes into operation. It will primarily serve domestic customers such as Huawei Ascend, delivering the critical “0-to-1” breakthrough. 2027: HBM3 enters scaled supply, with a monthly capacity target of approximately 50,000 wafers (equivalent to 20%–25% of Samsung and SK Hynix’s combined capacity at that time). Localization begins to register tangible progress. 2027–2028: This window marks the inflection point for domestic HBM adoption. Products enter the supply chains of mainstream domestic AI servers, and the HBM localization rate climbs from below 1% to 5%–10%. 2028–2030: HBM3E achieves mass production and development work targeting HBM4 commences. The localization target stands at 12%–15%. Post-2030: The technology gap is expected to narrow to roughly one generation behind. Still, Counterpoint analysts hold that “Chinese manufacturers will find it extremely difficult to catch up with South Korean leaders in high-end DRAM and HBM at least before 2030.”
Zhang Guobin emphasized that the true turning point for domestic HBM hinges not only on CXMT’s technical breakthroughs. It also depends on whether domestic AI accelerator chips (including Huawei Ascend and Cambricon) can reach sufficient shipment scale, alongside maturing advanced packaging supply chains such as TFME (Tianjin Funday Microelectronics) and JCET. Domestic HBM can only move beyond sampling to sustainable commercialization when “compute chips + high-bandwidth memory + advanced packaging” forms a self-reinforcing positive cycle.
All told, Apple’s failed attempt to force price cuts may only be the start. As AI reshapes computing infrastructure, memory is being revalued—and Chinese memory manufacturers have secured a seat at the table for pricing decisions.
-END- Editor/Layout: Zhu Wenfeng Proofreader: Mei Yaxin Supervisor: Liu Qicheng