Micron Gains as White House Blocks China Chips

Micron Technology shares increased by 2.6% ahead of Monday's trading session following a public warning from the Trump administration to Apple. The administration advised Apple against sourcing memory chips from Chinese suppliers, specifically targeting ChangXin Memory Technologies (CXMT) for DRAM and Yangtze Memory Technologies (YMTC) for NAND. This US Commerce Department directive effectively steers Apple towards domestic and allied producers, with Micron being the leading American manufacturer.

Commerce Secretary Howard Lutnick conveyed to the Wall Street Journal that the administration "does not approve" of Apple utilizing Chinese memory, emphasizing that shortages must be resolved differently. Apple had been evaluating DRAM chips from CXMT and NAND from YMTC, initially for devices sold within China. This situation is compounded by CXMT's presence on the Pentagon's Chinese Military Company blacklist and reported rejections of Apple's discount bids.

The global memory market is experiencing significant stress, with DRAM prices escalating approximately 29% in 2026. This surge is attributed to the immense demand from AI data centers consuming available supply. The situation has been described as the "worst-ever memory supply shortage," with projections suggesting the squeeze could persist into the next decade. This backdrop provided a rationale for Apple's exploration of Chinese suppliers, a move also reportedly considered by rivals HP and Acer.

Micron actively lobbied the White House in July, arguing that an Apple-CXMT agreement would undermine US domestic manufacturing and contradict Washington's semiconductor reshoring policy. Micron aims for a 40% share of US domestic DRAM output and has pledged over $250 billion in investments in American facilities by 2035. A bipartisan group of senators had previously cautioned Apple in June 2026, warning that procuring Chinese memory chips would set a precedent for other buyers, a warning now underscored by the administration's direct intervention.

Analyst sentiment has also shifted positively towards Micron, with New Street Research upgrading the stock to 'Buy' on Friday, viewing memory as "no longer a cyclical story" due to AI's impact on demand. Additionally, AI firm Anthropic reported preliminary second-quarter revenue of $11.5 billion, an over 14-fold increase year-over-year, further highlighting the booming AI sector's demand for semiconductor resources.