Micron announces $22 billion in long-term memory chip agreements with customers like Nvidia to mitigate boom-bust cycles.
Micron revealed $22 billion in long-term supply deals with customers, including Nvidia, to lock in demand for memory chips. These “take-or-pay” agreements require clients to purchase chips or pay penalties, aiming to stabilize revenue amid market volatility.
The move follows similar strategies by rivals Samsung and SK Hynix, as memory chipmakers seek to reassure investors about the durability of AI-driven demand. Memory stocks recently led a $1 trillion market rout, raising concerns over valuation and pricing power.
Analysts noted the deals improve visibility and push downside risks further out, focusing investor attention on monetizing current pricing power rather than long-term normalization.