Apple explores alternative iPhone memory suppliers

A report says shipments from a new Chinese vendor will begin in May…

What you need to know

Apple is exploring new memory suppliers for its iPhone.
A new report says it wants to diversify supply after disruption at a key Japanese partner.
Apple has reportedly tested new Chinese suppliers.

Apple is reportedly exploring alternative suppliers for the memory chips in its iPhone after disruption at a Japanese partner highlighted the need for diversification.

From Bloomberg:

Apple Inc. is exploring new sources of the memory chips that go into iPhones, including its first Chinese producer of the critical component, after a disruption at a key Japanese partner exposed the risks to its global supply.

It’s considering expanding a roster of suppliers that already includes Micron Technology Inc. and Samsung Electronics Co. after Kioxia Holdings Corp. lost a batch of output to contamination in February, people familiar with the matter said. While Samsung and SK Hynix Inc. — the world’s largest makers of flash memory — are likely to pick up the slack, Apple remains keen to diversify its network and offset the risk of further disruption from the pandemic and shipping snarls, they said.

The report says that Apple has tested sample NAND chips at Yangtze Memory Technologies, owned by state-backed Tsinghua Unigroup Co. The report says the move would be a milestone for China, but “could open Apple to criticism back home given ties between Washington and Beijing are fraying over China’s ambiguous stance on the Ukraine war as well as American efforts to contain its technological ascent.”

A separate Digitimes report Thursday says that Yangtze Memory Technologies has already cleared Apple’s validation process and is to start shipping small volumes in May “at the earliest”, however, Bloomberg says that “no final decisions have been made.” Bloomberg further stated it was not clear if Yangtze could convince Apple of its dependability, and that there were questions about its reliability in terms of both yields and quality.

It would give Apple a more stable supply base for the memory supplied to its best iPhones such as the iPhone 13, and pave the way for better supply as the company looks ahead to the iPhone 14, expected later this year.