The three companies that dominate the global market for memory chips—Samsung Electronics, SK Hynix, and Micron Technology—are devoting the majority of their production capacity to the fast-growing artificial-intelligence industry, according to a report in The Wall Street Journal. The shift has squeezed supply for consumer-electronics manufacturers that rely on the same chips, known as DRAM, and for storage chips known as NAND, pushing up prices for personal computers, smartphones, and other devices.
Apple Chief Executive Tim Cook said in an interview with the Journal that “everything needs to be on the table” regarding the policy choices affecting chip supply. Apple has raised prices on its latest iPhones, a move the company has attributed in part to rising memory-chip costs.
The imbalance between supply and demand is unlikely to ease quickly, industry executives and analysts said. Building new semiconductor factories, or fabs, takes years. U.S. lawmakers approved tens of billions of dollars in grants and tax credits under the 2022 Chips and Science Act to expand domestic manufacturing, including Micron facilities in Boise, Idaho, and Clay, N.Y., near Syracuse. But the first of the Idaho plants won’t open until the middle of next year, the Journal reported, and the New York plant is not expected to begin production until 2030.
“You have this fast-moving technological shift, but you’re constrained by slower moving physical systems like manufacturing,” said Kathryn Mitchell, a tech-policy adviser at law firm DLA Piper who previously helped fund chip projects at the Commerce Department.
The big memory-chip producers are approaching capacity expansion cautiously, burned by past boom-bust cycles. As recently as 2023, SK Hynix—now valued at more than $1 trillion—was losing billions of dollars and cutting production during an industry downturn. Micron cut 15% of its staff that year. The caution persists despite record gross profit margins: Micron reported margins of 80%.
Jim Secreto, a consultant who worked in the Commerce Department during the Biden administration, described the dynamic. “The AI companies have the deepest pockets in the economy and they’re outbidding everyone else for memory,” he told the Journal. “The rest of us just have to pay for it.”
President Trump and Commerce Secretary Howard Lutnick have focused on using subsidies and the threat of tariffs to pressure chip companies to increase domestic investment. Trump could direct memory-chip makers to allocate a certain percentage of output to consumer products, but such an arrangement would be difficult to enforce and could lead to shortages elsewhere, industry executives and analysts said.
Chinese memory manufacturers are growing quickly and could offer at least a partial fix. CXMT, China’s top DRAM producer, is seeking to raise $4 billion in an initial public offering in Shanghai and is building new factories. The company said its first-quarter 2026 revenue rose more than 700% year-over-year, though it acknowledged that its products still trail those of the three dominant industry players. Yangtze Memory Technologies, which focuses on NAND storage, is building three new factories that would more than double its current capacity by the end of 2027, people familiar with the plans told the Journal.
U.S. national-security rules, however, make it difficult for American companies to work with Chinese memory-chip makers. The goal is to protect U.S. technology secrets and the market position of Micron and allied suppliers in South Korea and Japan. Micron, an Apple supplier, has lobbied for even stronger restrictions and has pledged to invest some $200 billion across the United States. In Congress, lawmakers have introduced bipartisan legislation supporting tighter controls.
“What is the greater threat, the shortage or propping up China making advanced memory?” said Kevin Wolf, a lawyer at Akin Gump who worked on export controls in the Obama administration. “Propping up China would be bad for national security,” he said.
Nevertheless, the shortage has become severe enough that some large consumer-technology companies have asked administration officials to loosen the restrictions on working with China. The companies also want the U.S. to make it easier for Samsung and SK Hynix to boost production in China. HP, one of the world’s largest personal-computer makers, is in talks with supply-chain partners about using CXMT memory chips in products bound for Asia, people familiar with the discussions said.
In 2022, Apple worked with Yangtze Memory to prepare the Chinese NAND supplier to become a source of flash storage for the iPhone maker, but the company was forced to abandon that plan when lawmakers opposed it.