In today’s unusual market context, companies often find themselves negotiating terms that reflect a lack of confidence in long-term pricing, especially in sectors where shortages are impacting operations. This is exemplified by Samsung’s recent need to negotiate internally over DRAM contracts, specifically between its Semiconductor Division and its Mobile Experience Division.
Current Situation
Samsung‘s Semiconductor Division (DS) is opting not to provide its Mobile Experience Division (MX) with a full year’s supply of DRAM, instead moving to quarterly negotiations. This shift signals a proactive measure in response to potentially rising prices that could alter market dynamics quickly. Essentially, this means Samsung will remain flexible, adjusting terms as the supply chain evolves.
This situation highlights the tension within Samsung as prices continue to fluctuate in response to burgeoning demand from the AI industry and mobile products.
Samsung DRAM Negotiation
Image credit: NetEase
In summary, the memory sector is under significant strain, and companies amid this turmoil must navigate complex internal dynamics to make sound business decisions.
