CXMT and YMTC Taken Off Pentagon’s ‘Restricted Companies’ List, Paving the Way for Chinese DRAM and NAND Integration in Consumer Electronics

The recent update to the Pentagon’s Section 1260H list marks a significant turning point for China’s DRAM and NAND manufacturers. In a noteworthy decision, the companies CXMT and YMTC have been removed from this list, which previously categorized them as potential threats to national security.

New Opportunities for YMTC & CXMT in US Contracts: A Cautious Approach Required

This development opens up new avenues for manufacturers seeking to source Chinese memory and NAND products. A key barrier preventing their adoption has been political resistance. As documented in the latest Pentagon report, the removal of CXMT and YMTC from the Section 1260H list allows them to engage with US-focused manufacturers without the stigma of being labeled as national security threats. However, it’s essential to recognize that the path to widespread adoption remains uncertain.

YMTC 128L QLC 3D NAND chip resting on an orange circuit pattern background. — YMTC NAND chip

For context, Section 1260H is a list maintained by the US Department of Defense that identifies companies recognized as “Communist Chinese Military Companies”(CCMCs).This designation prevents these firms from conducting business within the United States, either directly or indirectly. YMTC was initially listed as a CCMC in 2024, while CXMT followed suit in 2025.

The Deputy Secretary of Defense has determined that the following previously listed entities should be removed from the most recent Section 1260H List announced on January 7, 2025:

ChangXin Memory Technologies, Inc.(CXMT)

Yangtze Memory Technologies Co., Ltd.(YMTC)

With their removal from Section 1260H, CXMT and YMTC are now eligible to participate in contracts with the US Department of Defense. However, it’s important to note that these companies are still under scrutiny from the US Commerce Department, particularly YMTC, which remains on the Entity List. This status poses potential risks for supply chain partners considering partnerships with these firms.

Despite the lifting of certain restrictions, major Original Equipment Manufacturers (OEMs) remain cautious. They have shown a sustained interest in integrating Chinese components into their products, yet the economic and political landscape continues to evolve. This creates a need for careful navigation of existing regulations, leading many manufacturers to proceed with a prudent approach when engaging with CXMT and YMTC.

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