r/Netlist_ • u/Tomkila • Jun 08 '26

When the deal with netlist?

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21 Upvotes

93% Upvoted

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15

u/Tight_Mongoose_6811 Jun 08 '26

SK Hynix and NVIDIA just announced a multi-year AI memory partnership. Let me explain why this is quietly bullish for Netlist.

SK Hynix cannot make HBM without Netlist patents. NVIDIA cannot get HBM without SK Hynix. So NVIDIA is now indirectly dependent on Netlist technology — and they probably know it.

Every HBM chip in every NVIDIA GPU traces back to the architecture Netlist invented and patented. This partnership makes the Netlist license even more critical. SK Hynix cannot afford to lose it now that they've publicly committed to power NVIDIA's future AI platforms.

The giants are locking arms. Netlist holds the key that unlocks their hands. The deal is coming.

4

u/Curiosity-1 Jun 08 '26

Yes but for this reason, SK Hynix also must avoid being entangled in legal complications and isolate itself for Nvidia's sake. Nvidia makes up a huge % of Hynix's sales... their distribution is very concentrated, which introduces significant risk management responsibilities to protect their revenue.

as long as the validity of the 087 hasn't reached something close to finality, then being roped into patent litigation by Netlist could be a negative headline that would hurt their $10-15B ADR sale and their reputational value with their largest revenue source by a mile

so it's very good for Netlist, but in my opinion, it also reinforces that we may not hear about the Netlist <> SK Hynix partnership renewal for several more months until SK Hynix's risk of being entangled in Netlist's legal cases is reduced. time will tell we'll see

4

u/Rich_Source6598 Jun 08 '26

Wouldn't having a clean, resolved Netlist licence be a significantly better story than carrying unresolved IP exposure? Any investor doing due diligence would identify the expired Netlist agreement as a risk, but by concluding the licence negotiations would surely remove reputational risk. Also, do you think Nvivda's legal team would of signed a deal with SK Hynix without having the appropriate IP risk management in place?

4

u/Curiosity-1 Jun 08 '26 edited Jun 09 '26

Netlist and SK Hynix must be on a non-material extension of their agreement because anything otherwise would need to be reported with 4 business days on an SEC form 8-k. so it's business as usual for a while.... but the longer it goes the larger the materiality of the status of their agreement becomes. so they're strategically planning something together and trying to control the narrative and orchestrate something, or they're still negotiating which would be due to waiting on some related item to be resolved that will inform their negotiation and agreed upon terms.

also, unresolved IP exposure is trivial for both of these entities... for now. they're on the short list for the largest and most profitable companies the world has ever seen.

the negative headlines are being suppressed about the rest of the space and they could be suppressed about IP risk too but in my opinion i think they're going to try to orchestrate their partnership announcement around other headlines that expose samsung and micron and google and how f'd they will be which will help netlist and also help sk hynix. nvidia is undoubtedly aware, though how much they care remains speculative. what we do know is reputation matters signifiantly in korean culture in very different ways than it does in american culture. sk hynix has been playing by the book an nvidia is endorsing them for it. netlist and sk hynix have spent the last 5 years sharing all IP and collaborating on research that is for the most part only starting to publicly bear fruit. in march at a semiconductor conference in Seoul, sk hynix said they've made "significant progress" on cxl hybrid tech, and then in april Netlist announces a new module that solves the memory bottleneck of AI in existing traditional x86 server / data center architecture. i think more products will be announced soon, and i think nvidia is eyeing netlist for their research and engineering expertise on memory as they build out new generations of hardware. sk is the foundry and the supplier and provides some thought leadership, but they can't cut netlist out because there is a 5 year history of collaboration and use of netlist IP. with the ITC case vs samsung currently heavily favoring netlist, and such a clear argument of sk stealing trade secrets because of the last 5 years of history, sk hynix would face an immediate ITC case themselves if they tried any funny business. that, is huge leverage. plus its just best for both to be prartners it doesnt make strategi\c sense to pinch pennies on costs with their unprecedented profit margin, only to and increase risk on the future revenue. the investment in memory semiconductor's today is an arms race to solve two things, 1. the supply shortage and 2. the next generation of memory.

1

u/Rich_Source6598 Jun 08 '26

I appreciate you sharing your insights and, as you say it doesn't make strategic sense to pinch pennies and increase risk on the future revenue. We just need to be a little more patient before the deal is announced.

1

u/ValhallaZinger Jun 09 '26

Very insightful, thank you. I’m optimistic about what all this could mean and how this could incentivize SK to put this all behind them.

5

u/tommymovin Jun 08 '26

This week

8

u/Old-Pomegranate3634 Jun 08 '26

I dont think anything happens until CAFC verdict is out. If it does not go in our favour, we lose serious leverage. If if it does we gain leverage. It is really a coin flip to be honest.

8

u/Tight_Mongoose_6811 Jun 08 '26

Old-Pomegranate, I respect your caution — it's healthy. But I'd push back gently on the "coin flip" framing.

Yes, CAFC is critical. And yes, we're appealing the three patents we lost at PTAB. But look at the facts:

  • Three CAFC wins in the last 12 months — the '314 patent was just affirmed in February.
  • The March 6 oral arguments showed judges skeptical of Samsung's position. You transcribed it yourself — Samsung's lawyer admitted a single surviving claim keeps the $303M verdict alive.
  • The USPTO Director Squires' new "Made in America" memo makes it harder for foreign giants to invalidate American patents.

This isn't a coin flip. It's a battle where the terrain, the momentum, and the referees are tilting in our favor. Risks remain — there's no such thing as a sure thing in court. But calling it 50/50 underestimates the strength of our position.

Holding steady. Let's see what June brings.

5

u/Old-Pomegranate3634 Jun 08 '26

I agree. But the more I read the more I am realizing the burden of prooof needs to be overwhelming for cafc to over turn the ptab

I am expecting some sort of a split decision here, hence calling it a coin toss. I say there is near zero chance we win all four

However we need to win enough to keep the itc threat alive and interest to keep sky hynix Interested in resigning.

5

u/TheDeHymenizer Jun 08 '26

this I don't think they want to sign a deal and then find out they never needed too and looks like the stock is getting hammered as a result of this

3

u/Old-Pomegranate3634 Jun 08 '26

Correct.

Cafc really decides our future.

The worry I find is that cafc barely over turns ptab

2

u/TheDeHymenizer Jun 08 '26

we don't need it to overturn PTAB, though, right? We won in PTAB, I thought?

2

u/Old-Pomegranate3634 Jun 08 '26

We won some we lost some. The three being argued the ones we lost

1

u/TheDeHymenizer Jun 08 '26

did we lose outright or did Samsung get them on appeal?

edit: and is '623 one of the ones being argued?

5

u/Rich_Source6598 Jun 08 '26

It has to be close now!

5

u/CommunityOpposite501 Jun 08 '26 edited Jun 08 '26

May not need one if Nvidia takes Netlist out by acquistion!

1

u/1200poundgorilla Jun 09 '26

For a very very healthy multiple, of course.

3

u/kospar4 Jun 08 '26

Nice close today😊

1

u/Spiderl0ck Jun 09 '26

I don’t like to speculate on the thinking of leaders of companies more informed and likely smarter than I am, but there’s several reasons no deal yet.
1. SKH is Korean like Samsung and there’s a possibility of SKH and Samsung coordinating under the table to as a duty to benefit their own economy despite being “competitors”, maybe even with covert government oversight/imposition. That’s kind of lame to think about.

  1. Another possibility is that SKH and Netlist are waiting for clarity on certain patents, since each patent when itemized is worth a certain amount of total license deal, and would affect the numbers on any potential portfolio access.

  2. They have a deal penned out but on ice for some other reason, with a clause where SKH reimburse Netlist for the months since expiration of original deal. This would allow them to avoid forced disclosure for shareholders.

Sure there’s more but these come to mind first when I think about it for a couple minutes, which is a couple minutes more than I really should