this post was submitted on 25 Jun 2026
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Memory-maker Micron has found a way to keep prices for its products sky-high for another five years, by signing 16 “strategic customer agreements” (SCAs) that include a floor price the company says comes with “a very robust gross margin for Micron, well above our peak quarterly margins in any past cycle.”

Micron CEO, president and chairman Sanjay Mehrotra explained the SCAs in prepared remarks delivered during the company’s Q3 earnings call. He explained that Micron has signed 16 SCAs, most of them covering 2026 to 2030, and that they involve a commitment to buy a certain quantity of product and pay for it in a pricing band that has a floor and a ceiling price. The floor price covers the historically high gross margins mentioned above, and the ceiling price means those who commit to an SCA are insulated if memory prices go even higher.

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[–] Zink@programming.dev 2 points 37 minutes ago

I wonder if anybody has told Micron about what happens when customers sign a contract but then declare bankruptcy shortly after.

[–] ayyy@sh.itjust.works 4 points 1 hour ago

Software developers: more Electron and bloated frameworks are what the people want! Running 10 independent browser instances for simple chat apps is a great idea!

[–] NocturnalMorning@lemmy.world 16 points 2 hours ago (2 children)

Isn't that called price fixing, and is generally illegal?

[–] Frenchgeek@lemmy.ml 8 points 1 hour ago (1 children)

Yes, but the fine is far lower than their profits here... so, it's only illegal if you can't afford it.

[–] EndlessNightmare@reddthat.com 4 points 1 hour ago

"Cost of doing business"

[–] Car@lemmy.dbzer0.com 8 points 2 hours ago

If there’s some collusion, sure, but you’d have to find a government body with the will and teeth to prosecute.

Nothing really against charging whatever you feel like outside of things like certain supplies during disasters. It’s shitty

[–] melsaskca@lemmy.ca 28 points 4 hours ago (1 children)

"Locks in"...if all of a sudden there was no demand you can be assured they would "lock out". Micron likes to put the boot to the throat when they have an advantage. Not someone I'd do business with.

[–] AEsheron@lemmy.world 1 points 1 hour ago (2 children)

Yeah, everyone was paying to back out of their contracts as soon as the prices went through the roof. The customers will do the same when they come back down if they are stuck in these contracts.

[–] badgermurphy@lemmy.world 2 points 1 hour ago

I believe that most of the customers signing these agreements are also the ones responsible for the memory shortage in the first place, and will go bankrupt when the AI bubble bursts, so the contracts will be voided in bankruptcy court.

[–] 3abas@lemmy.world 1 points 1 hour ago

Assuming these customers are the reason for the price hikes, their backing out is the demand loss needed to bring prices back down.

[–] some_guy 7 points 3 hours ago (1 children)

Well, I know who's gonna take a beating when the bubble pops and the market falls out from under them. What a stupid decision.

"Hey guys, this AI thing is gonna be like this forever. We'll never lack for insane demand ever again."

[–] jj4211@lemmy.world 3 points 1 hour ago

I think the logic for the customers is that either: A) It will work out exactly as predicted and we can afford whatever the hell we want, so it's worth it to have secured supply

B) Declare bankruptcy, the purchasing obligations no longer matter.

[–] rumba@lemmy.zip 2 points 2 hours ago (1 children)

the barrier to entry for ddr can't be so high that someone can't buy a fab machine and undercut them can it?

[–] darklamer@feddit.org 6 points 1 hour ago
[–] trackball_fetish@lemmy.wtf 1 points 2 hours ago

Fun fact: this place lays off employees damn near yearly, in big waves lol

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