Sinolink Securities: Micron Technology Advances Long-Term Agreements, Supply-Demand Gap Expected to Persist

Odaily Planet Daily News Sinolink Securities research report believes that Micron Technology is advancing long-term agreements, and the supply-demand gap is expected to persist. Micron has completed 16 SCA (Strategic Customer Agreements) with clients, covering downstream data centers, consumer electronics, and the automotive market. The SCA for automotive clients spans three years, while agreements with other clients are generally for five years. These 16 SCA agreements already account for 20% of Micron's DRAM shipments and one-third of its NAND shipments.

Even the lower bound of the price range within Micron's SCAs can generate profitability exceeding previous cycle peaks. Micron expects DRAM and NAND supply to remain tight through 2027. Sinolink Securities believes the storage industry supply will likely continue to be tight, enabling Micron to maintain high profitability. By advancing long-term agreements with downstream clients, Micron can reduce cyclical fluctuations in its product selling prices and mitigate the cyclicality of its performance. (Jin Shi)