Apple Said to Be Considering New iPhone Memory Chip Suppliers, Including in China

Apple is exploring new suppliers for memory chips used in its iPhones, including a potentially first Chinese supplier, after a key Japanese partner had an output disruption, Bloomberg News reported on Wednesday, citing sources.

Japan-based Kioxia Holdings — a key supplier of flash memory chips to Apple — had reported a contamination last month at two of its manufacturing facilities, which the company said will result in reduced production.

Apple is now testing sample NAND flash memory chips by Chinese semiconductor company Yangtze Memory Technologies, the report said, adding that the iPhone maker has been discussing the tie-up for months.

Yangtze declined to comment and Apple did not immediately respond to Reuters’ requests for a comment on the report.

Earlier this month, another key Apple supplier Foxconn had to suspend its Shenzhen operations due to a spike in COVID-19 cases. Foxconn started some production late last month at its Shenzhen campuses after arranging for some staff to live and work in a bubble, an arrangement requested by the local government as it battles the spread of COVID-19.

Only a small part of Foxconn’s production for Apple’s iPhone in China takes place in the southern city of Shenzhen, with the majority happening in Zhengzhou in the central province of Henan, according to sources.

A persistent industry-wide shortage of chips has also disrupted production in the automotive and electronics industries, forcing some firms to scale back production.

© Thomson Reuters 2022