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Micron’s Record Run Continues Amid Relentless AI Frenzy

Micron, one of the two suppliers of top-end chips to Nvidia along with South Korea’s SK Hynix, added nearly $19 billion to its market value this week

The United States' biggest memory chipmaker, Micron, announced plans on Friday to invest 4.3 billion yuan ($603 million) in a Chinese facility despite Beijing’s tit-for-tat curbs against the company.
Micron Technology is a US producer of computer memory and computer data storage. Photo: Reuters.


Memory chipmaker Micron Technology saw its stock soar to record highs this week as it continues to reap the benefits of the frenzy around artificial intelligence (AI). 

The Nvidia supplier’s share price was up 14% on Thursday, and is up 35% for the last month, after a strong revenue forecast amid relentless demand for the firm’s high-tech products.

Other chip firms such as Western Digital, Advanced Micro Devices and Broadcom also rose between 1.9% and 7.1% before the bell on Wednesday as Micron, which reports earnings before its peers, helps in gauging broader semiconductor demand.

The company said its high-bandwidth memory (HBM) chips, which refer to ultrafast semiconductors used in the development of AI applications, were sold out for 2024. A majority of its 2025 supply has also been allocated, it added.

“Memory is a key beneficiary of AI adoption and we expect a V-shaped recovery in the industry, with revenues expected to grow by 55% in 2024 and 35% in 2025,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.


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Micron, one of the two suppliers of HBM chips to Nvidia along with South Korea’s SK Hynix, was set to add nearly $19 billion to its market value, based on its premarket share price of $113.40.

On Wednesday ahead of the results, Micron was trading at about 24 times its 12-month forward earnings estimates, compared with 14.53 for smaller rival Western Digital.

Micron’s shares have surged more than 60% in the past 12 months, buoyed by investor confidence that the company will grow its share of the high-margin HBM market this year and the next.

Micron’s chief business officer, Sumit Sadana, said the company had signed up new customers for its HBM products that it was yet to announce.

Its current-quarter forecast for adjusted gross margin of 26.5%, plus or minus 1.5%, was also above market estimates of 20.8%, as the relatively new HBM chips are in short supply, giving companies such as Micron more pricing power.

“Tight supply, increasing demand, normalisation of excess inventory coupled with the increased size of HBM is driving dramatic improvements in pricing,” Piper Sandler analysts said.


  • Reuters with additional editing by Sean O’Meara


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Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.


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