Cotton urges Lutnick to blacklist China's CXMT from U.S. tech

Sen. Tom Cotton, R-Ark., wants Commerce Secretary Howard Lutnick to push ChangXin Memory Technologies onto the department's Bureau of Industry and Security Entity List. In a letter sent Thursday and first obtained by CNBC, Cotton wrote that CXMT poses a growing risk to American economic prosperity and military superiority, and that the U.S. must act to stop the company from gaining a stronger foothold in the global market.

Getting on that list would be a serious blow. Kyle Chan, a Brookings Institution fellow who studies China's tech development, told CNBC it means U.S. companies are not allowed to do business with the entity-listed firm, and that firm loses access to U.S. technology.

CXMT is the world's fourth-largest DRAM producer, the memory that powers basic functions in computers and smartphones. It's gaining fast: Counterpoint data shows its share of the DRAM market by revenue climbed from 4% to 10% between the second quarter of 2025 and the same quarter of 2026. In July, CXMT went public and its stock soared, briefly making it the most valuable company listed in China.

The bigger worry is high-bandwidth memory. CXMT's HBM capabilities are still nascent, according to Counterpoint, but Reuters reported the company planned to start production of the chips, with yields of just 20% to 30% — meaning most of what it makes is faulty. HBM powers AI chips from Nvidia, Google and Amazon Web Services, and only three companies — Samsung, SK Hynix and Micron — build it today.

CXMT already sits on the Pentagon's 1260H list of Chinese firms tied to Beijing's military, but Chan said that list carries little weight in restricting U.S. business. The Wall Street Journal reported Aug. 9 that Apple was weighing using CXMT memory in iPhones and Macs amid an AI-driven global shortage — something Entity List status could kill. Chan said Washington's concern is that even buying CXMT's products helps the company ramp up production and edge China closer to HBM, part of a broader push to slow China's chip development.

Cotton leaned on that in his letter, writing that CXMT moving forward in less than ideal conditions highlights Beijing's desperation for chips and its manufacturing struggles without advanced equipment and knowledge. More can be done, he added, to cut the company off from the financial and technological resources feeding its supply chain.