Memory pricing cycles are nothing new, but the way it’s being sold is changing. Over the past several months, Samsung and SK hynix have begun moving away from long-term, fixed-price supply contracts, replacing them with shorter agreements and post-settlement pricing mechanisms that allow prices to be adjusted after delivery. Micron is also understood to be following a similar path.
According to reporting cited by DigiTimes, these newer contracts are appearing at the same time as the sharp upswing in DRAM and NAND pricing we’ve been watching unfold with relentless escalation, driven primarily by AI infrastructure demand and constrained supply at advanced nodes. Memory makers are expected to make over $551 billion in revenue in 2026.
Where buyers once locked in prices for six to 12 months at a time with limited scope for renegotiation, suppliers are now favoring contracts measured in quarters or even months, with pricing that’s particularly exposed to market movements, which shifts the risk back onto buyers.
Post-settlement pricing reflects supplier confidence
(Image credit: SK hynix)
Under traditional agreements, DRAM and NAND prices are set at the time of signing. Even if spot prices move sharply, quarter renegotiation typically adjusts pricing within a narrow band of roughly 10%. These arrangements gave the market’s largest buyers cost predictability and insulated them from short-term instability.
Post-settlement pricing does the opposite. While products are delivered at the agreed price during the contract term, the final payment is adjusted at the end of the term to reflect prevailing market prices. If prices rise materially — as with DRAM in recent months — customers pay the difference. On the other hand, suppliers absorb the loss if prices fall.
Now, according to industry sources cited by Digitimes, Samsung, SK hynix, and Micron have all signed such contracts, primarily with large North American technology companies. One source noted that, for major customers, securing memory supply has become a higher priority than locking in price certainty, even if that means paying more later. This is nothing more than fundamental supply and demand dynamics that were bound to come into play given the state of the market in recent months.
It’s important to note that these post-settlement pricing arrangements only work if suppliers are confident that prices will remain elevated, because why would they push for them otherwise? The willingness of all the big three memory makers to adopt post-settlement pricing, unfortunately, suggests they are.
Contract lengths shrink alongside price flexibility
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