The Zhitong Finance App learned that Tesla (TSLA.US) and SpaceX (SPCX.US) CEO Elon Musk (Elon Musk) praised Optoelectronics (MU.US)'s storage pricing practices, saying that the company prioritizes customer loyalty in the wave of AI-driven chip price increases.
“Micron's handling of future storage prices has always been reasonable, while other vendors are asking for prices, and today's customers won't forget that,” Musk wrote on X. “Micron is making a smart move to earn long-term customer loyalty.”
Musk was responding to Nicholas Mugalli's post. Mugalli is an institutional TMT research analyst. In his post, he highlighted a J.P. Morgan Chase research report that is optimistic about the storage and memory industry. According to the report, Micron has locked 26 long-term supply agreements, covering more than 35% of its revenue by 2030, and remaining performance obligations amount to $150 billion, of which $32 billion has been committed in customer cash. According to the post, over 75% of Micron's FY2027 output has also been sold.
J.P. Morgan pointed out that the new agreement is being signed at a higher price, which may make Micron's full-cycle gross margin higher than the peak of the previous cycle. The gross margin of about 62% is a reference level. The bank also anticipates that SanDisk (SNDK.US) and South Korean storage vendors will also announce the progress of the long-term agreement.
Musk's xAI (now part of SpaceXAI) operates two AI data center facilities, Colossus and Colossus 2, near Memphis, Tennessee, which together provide approximately 1 gigawatt of computing power. The Nvidia (NVDA.US) graphics processors deployed at these facilities use Micron's storage technology.
Musk previously listed Micron, Samsung Electronics, and TSM.US as existing suppliers when discussing its Terafab chip project plans, but no direct deal between Micron and Musk's companies has yet to be announced.
As AI data centers drive demand for advanced chips, storage prices have skyrocketed. Micron, Samsung, and SK Hynix have turned their focus to high-bandwidth storage (HBM), which usually has higher margins, leading to a tightening supply of conventional DRAM for servers, PCs, and smartphones. According to Counterpoint Research, DRAM, NAND flash and HBM prices increased 80% to 90% in the first quarter of 2026 compared to the previous quarter.