every single time i think the ai memory investment is over i'm proven wrong, micron earnings is yet another sign the cyclical nature of memory has broken
-> 50%+ of micron's revenue comes from 16 strategic customer deals. thats $100B minimum over the next few years from 14 customers.
-> these customers are signing 5-year terms upfront. the norm is 1-2 years. guaranteed payment whether they need the memory supply or not.
anthropic just signed an exclusive partnership with micron yday. apple, google and nvidia are trying their hardest to secure more supply from SK and samsung
memory demand is increasingly faster than models are being optimized to use less memory. the direction for more memory scarcity is getting hard to ignore tbh
tae kim (@firstadopter)
HOLY CRAP $MU
Micron: “Fourteen of the 16 SCAs that we have signed have a cumulative revenue at minimum price per our contracts of approximately $100 billion over the remaining agreement term”
“We are excited to announce that we have now signed 16 strategic customer agreements, or SCAs, which we expect will fundamentally transform our business model.”
“We are pleased to announce that we have completed 16 SCAs with customers across the data center, consumer and auto market segments. These SCAs accelerate the transformation of our business model, enhance partnership in technology and innovation, and provide customers with contracted supply assurance.”
“Typically, these agreements have a five-year term, from calendar 2026 through the end of calendar 2030. Automotive agreements generally have a three-year term. The 16 signed agreements represent roughly 20% of our DRAM volume and a third of our NAND volume over this period. These SCAs include four very large customers and three medium-sized customers. The remaining agreements relate to smaller customers from the automotive industry and represent our commitment to this important sector.”
“When completed, we expect approximately half or more of our company revenue to be under these SCAs with customers across end markets. Our customers value our U.S. supply plans, and this is reflected in our SCAs.”
“These SCAs are structured as take-or-pay agreements, with binding commitments to purchase specific volumes over this multi-year term.”
— https://nitter.net/firstadopter/status/2069878139262849071#m