The transformation of storage giants into "super second parties" inevitably changes the business logic and valuation logic of storage giants through long-term agreements. Yesterday, a report from UBS pushed Micron to a trillion dollar market value, and today's report from Chosun Ilbo also helped Hynix cross the trillion dollar market value threshold. The core logic is consistent with yesterday's discussion on SanDisk's long-term agreement: storage vendors sign multi-year long-term supply agreements with customers, no longer relying on quarterly spot price negotiations like in the traditional storage industry, but using strong binding contracts to lock in production capacity, revenue, and risk. Greatly enhance the certainty of performance in the coming years. Today, the Korean newspaper Chosun Ilbo also reported that the three major tech giants (Alphabet/Google, Microsoft, Meta) have voluntarily offered to invest in supporting SK Hynix's new wafer fab in Longin. SK Hynix refused these financial assistance due to its extremely abundant cash flow. Internally, the company believes that these "investment proposals" should be used as leverage in exchange for longer-term and more favorable supply contracts (LTAs), in order to maintain its "super second party" status. This is consistent with yesterday's discussion about SanDisk's long-term agreement. Storage giants are taking advantage of the scarcity of production capacity and insufficient supply, using the patience brought by the current abundant cash reserves to transform customer demand into longer-term (3-5 years or even longer) lock-in agreements, rather than rushing to expand production. It can be seen that the overall logic of storage giants is: 1) Not accepting customer investment to control the pace of production expansion; 2) Use scarce production capacity to drive customers to lock in long-term agreements (starting from 3 years, now even more 5 years), and sign long-term contracts before receiving goods; 3) A prepayment of 10-30% of the total contract amount, with a guaranteed price. SanDisk's long-term contract is even more exaggerated, and customers also need to provide collateral and financial guarantees; Previously, long-term LTA contracts were established to stabilize demand and prevent a decline; Now we are taking advantage of the trend to increase prices, lock in high prices, lock in customers, and lock in industry dividends in the financial report in advance. LTA is no longer just a safe haven, but a tool for raising prices and locking in profits If long-term agreements can indeed smooth profit fluctuations during industry downturns, the cyclical nature of profits for storage giants will be significantly weakened, and the "cyclical discount" historically assigned by the market will lose its rationality - this is the core logical starting point of UBS's valuation reassessment This article is sponsored by @ bitget_zh, titled 'Bitget Buying US Stocks: Instant Entry, Smooth Trading'