Samsung targets 60–70% of HBM4 capacity under long-term agreements with five major customers identified as AWS, Microsoft, Google

Samsung has disclosed concrete progress on its long-term agreements (LTAs) for AI memory, signaling confidence in sustained demand. The company aims to allocate 60% to 70% of total production capacity to long-term contract volumes—a more aggressive target than Micron's expected 50% allocation under its Strategic Customer Agreements.

Samsung has already secured LTAs with five major global data center clients, with talks nearing completion on agreements with five additional large-scale players. The expected customer roster includes the three largest cloud providers—AWS, Microsoft, and Google Cloud—alongside Meta and Oracle.

Samsung's multi-year LTAs follow a rolling five-year structure, with contract terms renewed annually through negotiations. The LTA model is expanding beyond DRAM into NAND flash, with Samsung beginning to extend long-term supply agreements across both memory technologies.

The agreements include customer deposits and binding provisions to strengthen contract execution and improve long-term demand visibility, mirroring mechanisms disclosed by SK hynix. Samsung has already secured upfront payments covering approximately one-quarter of contracted volumes to reinforce customer purchase commitments. The LTAs also feature price floor mechanisms for commodity memory products, providing protection against sharp market downturns.

Demand continues to outpace supply, with many additional customers seeking new agreements while existing contract customers request further supply. Samsung expects the AI memory shortage to worsen next year, with the supply-demand imbalance persisting through 2028.

LTA volumes are projected to account for more than 30% of server DDR5 shipments in the second half of 2026. Including other contract-based businesses such as HBM, analysts estimate that nearly half of global DRAM capacity could be locked under long-term agreements by 2027, accelerating the industry's shift toward contracted supply.

The growing prevalence of LTA-backed supply is reshaping memory pricing dynamics. Several U.S.-based cloud service providers have entered multi-year LTAs that restrict suppliers from raising prices for these clients. Consequently, server DRAM contract prices are forecast to rise 13% to 18% quarter-over-quarter in the third quarter of 2026.