Memory chips' share of total smartphone component costs has exploded from roughly 13% to 43% . That means any memory price increase now hits total device cost far harder. Huawei's own Pura 90 series already saw per-unit BOM costs jump by CNY 1,000–1,500 due to memory inflation alone, even before the latest surge .

Yu's warning was rooted in four compounding factors: the AI boom diverting fab capacity to high-margin HBM chips, a three-company DRAM oligopoly, the disruptive DDR4-to-DDR5 transition, and a geopolitical standoff that leaves even Apple without a cheap way out.

The Forces Behind the Memory Price Surge

AI Demand Eats Fab Capacity. Explosive demand for AI data-center chips—especially High Bandwidth Memory (HBM)—has diverted the most advanced fab capacity away from general-purpose DRAM used in phones . Samsung and SK Hynix both allocate their newest lines to HBM, where margins are higher, tightening supply of mobile DRAM.

The DRAM Triopoly. Samsung, SK Hynix, and Micron control the vast majority of global DRAM output. With only three dominant players, supply constraints are quickly felt across the market .

DDR4-to-DDR5 Transition. The industry-wide shift to DDR5 memory creates production disruption as older lines are phased out and newer ones take time to reach volume.

Apple’s Bargaining Play That Backfired

At the same time, Apple tried to use Chinese memory maker CXMT (ChangXin Memory Technologies) as a leverage play to push down mobile DRAM prices. The strategy collapsed :

• What Apple wanted: Lower pricing on LPDDR5X mobile DRAM to ease cost pressure on its next iPhone lineup .
• What CXMT said: No discount. CXMT quoted prices at or above Samsung and SK Hynix levels .
• Why CXMT could refuse: Huawei, Xiaomi, ByteDance, and other domestic Chinese companies had already locked up most of CXMT's output under long-term contracts. ByteDance alone signed a $7 billion long-term deal . With demand from Chinese brands exceeding supply, CXMT had zero incentive to offer Apple a concession price .
• Outcome: Apple's plan to use CXMT as a bargaining chip against the Korean duopoly backfired. Samsung and SK Hynix ended up with more pricing power, not less .

How Korean Suppliers Benefit Doubly

Samsung and SK Hynix are gaining on two fronts :

1. Mobile DRAM pricing stays high. With CXMT refusing to undercut them and general supply tight, the Korean duo can maintain elevated pricing for LPDDR5X and other mobile memory.
2. HBM focus pays off. Both allocate their most advanced fab capacity toward high-margin HBM chips for AI accelerators, where margins are far fatter than mobile DRAM. Tight mobile-DRAM supply is a side effect that reinforces their pricing discipline.

U.S. Political Pressure Eliminates Apple’s Last Alternative

In late July 2026—days before the August 5 events—a bipartisan group of U.S. senators led by Senate Majority Leader Chuck Schumer (D-NY) and Senator Jim Banks (R-IN) sent a letter to Apple CEO Tim Cook demanding that Apple publicly commit to never using memory chips from CXMT or YMTC :

• CXMT and YMTC are on the U.S. Department of Defense's "Chinese Military Companies" list .
• The senators warned that buying from these firms would subsidize China's military-industrial base and create reliance on a U.S. adversary for critical components .
• They gave Apple an August 21 deadline to respond with a commitment to drop Chinese memory suppliers .
• Separately, House members wrote to Commerce Secretary Howard Lutnick arguing that every purchase from CXMT subsidizes the PLA .

This political pressure on Apple to exclude CXMT as an option—combined with CXMT's own refusal to offer discounted pricing—leaves Apple with fewer alternatives and reinforces the pricing power of Samsung and SK Hynix.

The Interconnected Chain

The chain runs like this: AI demand, the triopoly structure, and the DDR5 transition created the underlying supply squeeze. Chinese brands already bought up CXMT's output, so CXMT could stiff Apple's price-cut request. U.S. political pressure took CXMT off the table as an alternative. Yu publicly warned the whole smartphone industry would have to raise prices or bleed. Samsung and SK Hynix benefit on both the HBM and mobile DRAM sides.

Some contract quotes for PC memory jumped 90% or more in early 2026, according to TrendForce data . Smartphone makers such as Xiaomi, Oppo, and Vivo have already slashed shipment forecasts multiple times for 2026 . The entire industry faces its most aggressive price-adjustment wave in years .

Memory chips' share of total smartphone component costs has exploded from roughly 13% to 43% . That means any memory price increase now hits total device cost far harder. Huawei's own Pura 90 series already saw per-unit BOM costs jump by CNY 1,000–1,500 due to memory inflation alone, even before the latest surge .

Yu's warning was rooted in four compounding factors: the AI boom diverting fab capacity to high-margin HBM chips, a three-company DRAM oligopoly, the disruptive DDR4-to-DDR5 transition, and a geopolitical standoff that leaves even Apple without a cheap way out.

The Forces Behind the Memory Price Surge

AI Demand Eats Fab Capacity. Explosive demand for AI data-center chips—especially High Bandwidth Memory (HBM)—has diverted the most advanced fab capacity away from general-purpose DRAM used in phones . Samsung and SK Hynix both allocate their newest lines to HBM, where margins are higher, tightening supply of mobile DRAM.

The DRAM Triopoly. Samsung, SK Hynix, and Micron control the vast majority of global DRAM output. With only three dominant players, supply constraints are quickly felt across the market .

DDR4-to-DDR5 Transition. The industry-wide shift to DDR5 memory creates production disruption as older lines are phased out and newer ones take time to reach volume.

Apple’s Bargaining Play That Backfired

At the same time, Apple tried to use Chinese memory maker CXMT (ChangXin Memory Technologies) as a leverage play to push down mobile DRAM prices. The strategy collapsed :

• What Apple wanted: Lower pricing on LPDDR5X mobile DRAM to ease cost pressure on its next iPhone lineup .
• What CXMT said: No discount. CXMT quoted prices at or above Samsung and SK Hynix levels .
• Why CXMT could refuse: Huawei, Xiaomi, ByteDance, and other domestic Chinese companies had already locked up most of CXMT's output under long-term contracts. ByteDance alone signed a $7 billion long-term deal . With demand from Chinese brands exceeding supply, CXMT had zero incentive to offer Apple a concession price .
• Outcome: Apple's plan to use CXMT as a bargaining chip against the Korean duopoly backfired. Samsung and SK Hynix ended up with more pricing power, not less .

How Korean Suppliers Benefit Doubly

Samsung and SK Hynix are gaining on two fronts :

1. Mobile DRAM pricing stays high. With CXMT refusing to undercut them and general supply tight, the Korean duo can maintain elevated pricing for LPDDR5X and other mobile memory.
2. HBM focus pays off. Both allocate their most advanced fab capacity toward high-margin HBM chips for AI accelerators, where margins are far fatter than mobile DRAM. Tight mobile-DRAM supply is a side effect that reinforces their pricing discipline.

U.S. Political Pressure Eliminates Apple’s Last Alternative

In late July 2026—days before the August 5 events—a bipartisan group of U.S. senators led by Senate Majority Leader Chuck Schumer (D-NY) and Senator Jim Banks (R-IN) sent a letter to Apple CEO Tim Cook demanding that Apple publicly commit to never using memory chips from CXMT or YMTC :

• CXMT and YMTC are on the U.S. Department of Defense's "Chinese Military Companies" list .
• The senators warned that buying from these firms would subsidize China's military-industrial base and create reliance on a U.S. adversary for critical components .
• They gave Apple an August 21 deadline to respond with a commitment to drop Chinese memory suppliers .
• Separately, House members wrote to Commerce Secretary Howard Lutnick arguing that every purchase from CXMT subsidizes the PLA .

This political pressure on Apple to exclude CXMT as an option—combined with CXMT's own refusal to offer discounted pricing—leaves Apple with fewer alternatives and reinforces the pricing power of Samsung and SK Hynix.

The Interconnected Chain

The chain runs like this: AI demand, the triopoly structure, and the DDR5 transition created the underlying supply squeeze. Chinese brands already bought up CXMT's output, so CXMT could stiff Apple's price-cut request. U.S. political pressure took CXMT off the table as an alternative. Yu publicly warned the whole smartphone industry would have to raise prices or bleed. Samsung and SK Hynix benefit on both the HBM and mobile DRAM sides.

Some contract quotes for PC memory jumped 90% or more in early 2026, according to TrendForce data . Smartphone makers such as Xiaomi, Oppo, and Vivo have already slashed shipment forecasts multiple times for 2026 . The entire industry faces its most aggressive price-adjustment wave in years .