Apple Reportedly Signs NAND LTA with Kioxia, May Have No Price Ceiling

LTA Expands from HBM to NAND and DRAM

For years, long-term agreement (LTA) has been primarily centered around HBM, which has seen limited supply, while DRAM and NAND flash have mostly been procured through quarterly contracts. However, as AI data center investments continue to expand, demand for HBM, server DRAM, and eSSD has grown rapidly, prompting memory manufacturers to increase the proportion of long-term contracts for DRAM and NAND flash.

Apple Signs NAND Flash LTA, May Have No Price Ceiling

Since the beginning of this year, the terms of trade between Apple and Kioxia have reportedly tilted in Kioxia's favor. Earlier reports indicated that Apple agreed to roughly double its NAND flash payment to Kioxia starting from the first quarter of 2025, switching to quarterly price adjustment based on market condition. During the memory price upcycle, Apple has also faced upstream cost pressure.

With memory supply continuing to tighten, Apple has begun prioritizing stable NAND flash supply over pricing. According to Korean media citing industry sources, Apple has recently signed a long-term agreement for NAND flash memory. While specific details such as the counterparty, volume, and pricing terms have not been officially disclosed, market speculation widely points to Kioxia, Apple's major NAND flash supplier, as the likely partner.

Some observers believe the contract spans three to five years with no price ceiling, though the contract duration and detailed pricing terms have yet to be officially confirmed.

Apple's Diversification Efforts Constrained, Market Eyes Future LPDDR LTA

To strengthen its bargaining power, Apple has been pushing to diversify its procurement sources. Reports indicate that Apple has tested CXMT's LPDDR5X products and evaluated supply feasibility, but the negotiation has yet to reach an agreement as CXMT's quote is reportedly close to or even higher than those of other major memory suppliers. In addition, the U.S. government's stance on Apple using Chinese memory products has further constrained Apple's ability to expand its supplier base.

The market is focusing whether Apple will extend its long-term contract strategy to LPDDR following this NAND deal. With HBM and server DRAM demand surging and tightening general-purpose memory supply, industry insiders speculate that Apple may sign more LTAs with memory manufacturers to secure supply of LPDDR5X and LPDDR6 memory for future iPhones.