Samsung Electronics said it is receiving indications of direct memory purchases and requests for long-term supply contracts from artificial intelligence (AI) frontier model developers. As it has become difficult to secure the necessary AI infrastructure solely through cloud providers, model developers are moving to secure memory directly.
Samsung Electronics said at the second-quarter earnings conference call on the 30th that "AI frontier model firms that failed to secure the necessary AI service infrastructure due to memory shortages are sharing medium- to long-term demand outlooks and conveying to us their intent to buy directly," adding, "they have also begun requesting long-term supply contracts to secure large additional supply."
According to Samsung Electronics, some AI model firms are failing to secure sufficient cloud service capacity from hyperscalers and are requesting additional capacity from neocloud providers. This is also leading to large memory supply requests from server manufacturers that count neocloud providers as customers.
Samsung Electronics is negotiating long-term supply contract terms with customers that can guarantee a certain level of future demand. The company expects this to shift its business structure—where earnings volatility has grown with swings in the memory market—toward a more stable and predictable trajectory.
Samsung Electronics plans to make preemptive investments in infrastructure such as clean rooms once long-term demand visibility is secured, then flexibly adjust the timing of production equipment introduction to match actual demand.