Daily Alpha · X
· Post-Market Alpha · by Buzzberg Research
Serenity (@aleabitoreddit) and Jukan took opposite sides on whether memory take-or-pay contracts hold in a downturn, while Chamath tied compute pricing to data-center delays and a 90-day termination clause.
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Market Radar →Chamath: a 90-day termination clause matters if scarce supply lifts compute spot prices 50% or more
Chamath points to the case where spot compute prices move 50% or more on a lack of supply and a seller of energized compute holds a 90-day termination clause. A quoted clip says SpaceX could then end its Anthropic compute deal and bring it back at 2x to 3x the price.
Correct. Specifically, odds will go up with every data center delay.
Chamath says this is not commentary on Anthropic or SpaceX but the mathematics of scarce energized compute.
Watch Spot compute prices as data-center projects are delayed.
Source →Jukan cites onsemi's 2023 forecast cut despite take-or-pay contracts
onsemi's CEO called its LTSAs legally binding take-or-pay in January 2023, yet in October 2023 the company cut its SiC shipment forecast from $1 billion to more than $800 million after one automotive OEM reduced demand.
I'd like to believe LTAs are durable too. But take one example. Analog chipmaker onsemi said this in 2023.
The CEO said he did not want to enforce the contracts just to push inventory onto a customer whose demand had dropped.
Watch Whether memory makers enforce take-or-pay terms on customers whose demand drops.
Source →Nikkei: Terafab targets 1 million wafers per month from 2032, 700,000 for memory
Elon Musk's Terafab has told semiconductor equipment suppliers it is targeting production capacity of 1 million wafers per month from 2032 onward, with 700,000 allocated to memory chips and 300,000 to logic, per Nikkei.
NIKKEI: ELON MUSK’S TERAFAB HAS TOLD SEMICONDUCTOR EQUIPMENT SUPPLIERS IT IS TARGETING A PRODUCTION CAPACITY OF 1 MILLION WAFERS PER
Jukan questioned the 700,000-wafer memory allocation.
Watch Equipment orders tied to Terafab's memory capacity.
Source →@aleabitoreddit quotes Micron: strategic customer agreements are take-or-pay with no contractual outs
Serenity (@aleabitoreddit) quoted Micron saying customers are obligated to pay for committed volumes whether they take delivery or not, and that past LTAs never had binding terms. Serenity also cited GE Vernova's CEO saying it was not seeing turbine cancellations or financing difficulties.
Some industry commentary regarding a few claims recently on memory + Softbank Turbine defaulting.
Per the post, Micron says these agreements differ from historical memory cancellations.
Watch Whether Micron's take-or-pay terms are enforced if prices fall.
Source →Goldman puts about 45% of planned US data-center capacity in states with potential restrictions
Goldman Sachs says Texas alone accounts for about 25% of planned U.S. capacity, and UBS estimates about 30% of additional capacity through 2028 could be affected.
Goldman Sachs says states with potential restrictions account for roughly 45% of planned U.S.
The poster sees 2028 as the most critical year, with 2027 construction possibly continuing at its current pace.
Watch 2028 capacity timelines at NBIS, IREN and CRWV.
Source →