Tech Bytes: LTAs – How They Are Affecting Memory

研报英文原文证据摘录

Tech Bytes: LTAs – How They Are Affecting Memory

Global Idea

May 18, 2026 01:59 PM GMT

Morgan Stanley & Co. International plc+MTech Bytes Shawn Kim

Equity Analyst

LTAs – How They Are Affecting Shawn.Kim@morganstanley.comMorgan Stanley & Co. International plc, Seoul Branch++44 20 7677-1018

Ryan Kim

Equity AnalystMemory Ryan.G.Kim@morganstanley.com +82 2 399-4939

Morgan Stanley Asia Limited+

What’s Changed

Duan Liu

SK hynix (000660.KS) From To Equity Analyst

Price Target W1,700,000 W2,600,000 Duan.Liu@morganstanley.com +852 2239-7357

Memory has become a critical bottleneck in AI infrastructure. Morgan Stanley & Co. International plc+

LTAs with customers to secure supply are transforming a CindyEquity AnalystHuang

traditionally cyclical business into a secured, high-margin, long- Cindy.Huang@morganstanley.com +44 20 7425-2915

term revenue stream. However, they also create a "memory tax"

on the rest of the industry.

The memory market is undergoing a structural transformation in how its

products are being contracted through long-term agreements (LTA) of 3-5 years:

These have existed during semiconductor booms, but recent LTAs differ from past

ones with weak binding power. They may include receiving large up-front payments

that could dictate volume commitments by producers and be deducted as

unfulfilled promised volumes are shipped. These are likely non-cancellable, non-

refundable (NCNR) contracts, in our view; effectively, they are insurance or binding

power in case the customer cancels existing LTAs in the future.

The cyclical impact may become less cyclical: LTAs can instill stability, improve

earnings predictability, and reduce the risk of overbuilding capacity with better

supply management for memory companies. Even if there is excess supply from