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Netlist signs five-year Samsung patent alliance worth up to $750M
The deal includes a $200M upfront patent fee and Samsung will buy 10 million Netlist shares, with additional quarterly fees of up to $27.5M net per quarter.
Netlist, Inc. has entered a five-year strategic alliance with Samsung that pairs patent cross-licensing with a memory supply agreement, with total net patent fees potentially reaching $750 million. Yahoo Finance reports the arrangement also resolves pending Samsung litigation and lets Netlist continue pursuing other alleged infringers.
Under the patent portion of the deal, Netlist expects a $200 million upfront payment after withholding of Korean taxes, equal to $239 million gross. The company will also receive 20 recurring quarterly license fees of up to $27.5 million net of tax, or $32.9 million gross, based on a revenue-based formula, for aggregate net license fees up to $750 million over the term.
The supply agreement calls for Samsung to provide Netlist with up to $300 million of memory products annually, totaling up to $1.5 billion over five years. The products include DRAM and NAND used in Netlist's proprietary memory solutions, as well as standard Samsung memory and storage products for resale to Netlist's customer base.
Netlist said the deal supports collaboration on AI-focused technologies, including hybrid CXL memory and low-power MRDIMMs, and CEO Chuck Hong characterized it as a major milestone for Netlist's IP in memory technologies tied to AI computing. CFO Gail Sasaki said the supply agreement is intended to provide sourcing assurance during a period of high demand and constrained memory supply linked to AI infrastructure build-outs.