Samsung to delay its planned DDR4 end-of-life due to signing a long-term 'non-cancellable, non-returnable' contract with key customer — agreement will not alleviate consumer shortage, supply earmarked for server clients

Samsung has reportedly delayed the shutdown of its DDR4 production line, which it initially announced earlier this year. According to DigiTimes [machine translated], the South Korean chipmaker is doing this as 16GB DDR4 modules hit a record of $60 in the spot market. This pricing made the DDR4 market lucrative enough for Samsung to delay the shutdown of its existing DDR4 production line. However, it will not set up new ones to accommodate increasing consumer demand. In line with this, reports indicate that one customer has already signed an “NCNR contract” with the company to secure its DDR4 supply.

NCNR (non-cancellable, non-returnable) contracts mean a client will receive a fixed number of memory modules at a fixed price, and that the price or volume cannot be modified in the future. In other words, the customer is contractually obliged to buy the product regardless of any other factors.

This type of agreement ensures stability in both volume and cost for the customer so that they won’t be affected by the current volatility in the memory market driven by the AI rush. On the other hand, this helps Samsung insulate itself from uncertainty in the memory market. Even if the AI bubble bursts and there is an oversupply of HBM and DDR5 memory modules, causing their prices to drop, this ensures that its DDR4 production line remains profitable.

Sources say the NCNR's price is expected to exceed $20 per 16GB DDR4 module, but Samsung is still evaluating the market and may increase it further. Still, this is only a third of prevailing spot market prices for short-term contracts. Unfortunately, the client said to be gunning for the NCNR contract mainly focuses on server applications, and no consumer-facing company has signaled its intent to secure a long-term contract for DDR4 chips. This means that end-users should not expect any relief from the ongoing memory shortage.

Samsung originally planned to end DDR4 production to focus on HBM and DDR5, but it seems that the booming AI demand for HBM has caused DDR5 memory pricing to skyrocket. This led to higher demand and prices for older DDR4 memory, causing the big three memory makers to delay their planned shutdown of DDR4 production lines. However, these are expected to serve industry clients, not consumers, so PC builders and enthusiasts should not expect any form of relief from the RAM shortage in 2026.

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