Big tech is now locking in supply chains the way they locked memory — and it's spreading fast across the AI infrastructure stack.
Nearly 80% of Samsung's 2025 memory volume, including HBM, is already committed under long-term agreements. SK Hynix has closed its major deals. $MU went from 16 strategic customer agreements in Q2 to 26 in Q3. If you didn't sign early, you're fighting for scraps.
This isn't just memory anymore. Samsung Electro-Mechanics is closing a ~$520M MLCC deal with Delta. It's signed six MLCC LTAs this year totaling $3.4B. LG Innotek is negotiating FC-BGA deals. LS Cable locked five-year bus duct agreements with Meta and Google. LG Electronics signed a $3.7B chiller contract with a U.S. AI data center firm.
The terms show who has leverage right now. Memory deals run five years, rolled forward annually. Prepayments of 20–25% are standard, and buyers pay even if they don't take delivery. Suppliers are using that cash to fund new fabs.
But here's the cycle risk: A customer can still walk and eat the penalty. If demand softens in 2028, who really holds the volume when the contract was signed in a 2026 upcycle? The supplier built the fab on a take-or-pay deal, but that doesn't stop renegotiation when prices fall.
Prepayments fund capacity. They don't lock behavior when the market turns.
Nearly 80% of Samsung's 2025 memory volume, including HBM, is already committed under long-term agreements. SK Hynix has closed its major deals. $MU went from 16 strategic customer agreements in Q2 to 26 in Q3. If you didn't sign early, you're fighting for scraps.
This isn't just memory anymore. Samsung Electro-Mechanics is closing a ~$520M MLCC deal with Delta. It's signed six MLCC LTAs this year totaling $3.4B. LG Innotek is negotiating FC-BGA deals. LS Cable locked five-year bus duct agreements with Meta and Google. LG Electronics signed a $3.7B chiller contract with a U.S. AI data center firm.
The terms show who has leverage right now. Memory deals run five years, rolled forward annually. Prepayments of 20–25% are standard, and buyers pay even if they don't take delivery. Suppliers are using that cash to fund new fabs.
But here's the cycle risk: A customer can still walk and eat the penalty. If demand softens in 2028, who really holds the volume when the contract was signed in a 2026 upcycle? The supplier built the fab on a take-or-pay deal, but that doesn't stop renegotiation when prices fall.
Prepayments fund capacity. They don't lock behavior when the market turns.