Sandisk Stock Falls 7.5% on Apple China Chip Sourcing Reports

Sandisk stock fell 7.5% Monday after reports that the Trump Administration will allow Apple to buy memory chips from Chinese suppliers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Corp (YMTC). YMTC competes directly with Sandisk in NAND memory chips, while CXMT makes DRAM chips. Sandisk's high-bandwidth flash memory will also compete with CXMT's planned high-bandwidth memory. However, chips sourced from China would only be used in Apple products sold in China. Analysts note YMTC and CXMT lack Apple certification and production capacity to seriously challenge Sandisk yet. Both companies are raising billions through IPOs to expand production, signaling future competitive pressure.