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Shares of Biwin Storage Technology soared following the announcement that the company has signed a deal to purchase storage wafers valued at $1.5 billion, aiming to mitigate the impact of price fluctuations on production costs.
The company’s stock closed at 253.35 Chinese yuan ($36.76), marking a 9.4% increase for the day, after earlier jumping as much as 12.9%. The broader Shanghai stock index also climbed by 1.3%.
Starting next quarter, the Shenzhen-based firm will buy storage wafers at fixed prices over the next two years. The purchases will be evenly spread across eight quarters, with the annual quantity equivalent to roughly 11% of the NAND Flash wafers it bought last year. The deal is designed to strengthen the stability of mid- and long-term supply without revealing the supplier’s identity for confidentiality reasons.
Global suppliers of NAND Flash wafers include major players like Samsung, SK Hynix, Kioxia, Micron Technology, and Western Digital.
Focused on researching, designing, packaging, and testing semiconductor memory, the company has recently reported a significant financial jump. Its net profit surged by 429% to 853 million yuan ($120 million) over the 12 months ending December 31, compared to the previous year. Revenue also grew by 69%, reaching 11.3 billion yuan ($1.6 billion), driven by increasing demand from artificial intelligence applications.
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