There has been a severe shortage of memory chips for the past couple of years, and Samsung is making full use of its dominant position in this segment to increase profits and secure its near future. The world's largest memory chip maker can now rest assured that it will continue to see strong demand over the next few years.

A report from Maeil Business Newspaper claims that major Chinese tech companies, including Alibaba, ByteDance (TikTok owner), and Tencent, are asking Samsung for ultra-long long-term agreements (LTAs) for memory chips. Usually, LTAs span three to five years, but these Chinese firms reportedly want 10-year LTAs as they aggressively try to secure server-grade DDR and LPDDR DRAM chips.

While LPDDR DRAM chips are typically used in low-power devices like laptops, smartphones, and tablets, they are now in strong demand to help manage power efficiency in AI servers.

AI companies need massive amounts of memory chips to power their AI servers and cloud infrastructure. Most major US tech giants have already locked in LTAs for memory chips from Micron, Samsung, and SK Hynix, forcing Chinese cloud service providers to rush to secure the remaining supply.

Samsung is projected to earn more profit this year than in the past 40 years combined, but there have been concerns about how long this scenario will last and what happens when the AI bubble bursts. However, with three- to five-year LTAs with US tech giants and possible 10-year LTAs from Chinese tech firms, Samsung appears well-positioned for the future.