Chinese tech firms seek 10-year memory chip contracts

Major Chinese technology companies, including Alibaba, ByteDance, and Tencent, are reportedly negotiating long-term DRAM supply agreements with Samsung Electronics and SK Hynix. These discussions involve contracts lasting up to ten years, a significant extension from the industry standard of three to five years.

The move is driven by the surging demand for AI infrastructure, specifically for DDR and LPDDR memory used in servers and data centers. By securing these long-term agreements, Chinese firms aim to guarantee supply for AI workloads and mitigate risks associated with geopolitical uncertainty, following similar strategies previously employed by US-based hyperscalers.

Market analysts suggest that such extended contracts could account for 70–80% of planned memory output for certain years, potentially reducing available supply for smaller buyers in the spot market. For manufacturers like Samsung, these deals offer predictable revenue and guaranteed sales amidst high demand for AI-related memory components.