News about Micron

The report values 3D integrated circuits at $16.8bn in 2024, with the memory segment projected to reach $22.2bn by 2030 as data centres need denser, more energy-efficient chips. Growth is driven by cloud computing, data centres, AI and machine learning, along with demand for miniaturised consumer devices and heterogeneous integration. The memory segment is forecast to grow at a CAGR of 19.2% and LEDs at 18.2%. The US market was about $4.6bn in 2024, while China is forecast to grow at a CAGR of 16.6% to roughly $6.7bn by 2030. The analysis also covers tariff risks, supply chain shifts and 26 companies, and names TSMC, NVIDIA, Micron and Amkor among those in the competitive race.

Members of Micron's Taoyuan union in Taiwan voted 99% in favour of authorising a strike over how the company splits profits, though no date has been set. The union wants 15% of operating profit paid to workers through a permanent system, and mediation failed in September, prompting Taiwan's labour ministry and President Lai Ching-te to urge both sides to negotiate. Taiwan is arguably Micron's most important country, with most of its fiscal 2026 DRAM output made there, but the vote so far covers only the smaller Taoyuan site, while the Taichung union, representing around 10,000 workers in Taichung and Tainan, holds a second mediation session on Oct. 22. Micron says it has already sold out all the 2027 capacity of the Taichung factory, so a long strike could leave it short on contractual deliveries. The shares trade near $879, about 28% below their late-June record close of $1,213.56, and the author still expects a deal and does not see the vote as a reason to sell.

U.S. chip stocks rebounded over the weekend after their worst week since March, as investors repositioned ahead of third-quarter earnings from Tesla, Netflix and Meta. Intel and AMD each rose about 2.6% in overnight trading, while Micron and SanDisk gained 1.8% and 2.6%, and the iShares Semiconductor ETF (SOXX) rose 2.4% after an 11.8% drop the previous week. In a Nikkei interview, Intel CEO Lip-Bu Tan said the company was “80% done” with its restructuring and pointed to AI chip packaging and ASICs as growth areas. Intel also unveiled its GPU D-series with up to 480GB of memory, which according to TechRadar surpasses the 288GB of Nvidia's Blackwell Ultra B300 for data center GPU memory capacity. Stocktwits sentiment was bullish on SOXX, bearish on INTC, neutral on AMD and bullish on MU and SNDK, while one trader warned of possible further downside before a bounce and advised caution with long positions until last week's high is broken.

The author says that if he could own only one AI memory stock for the next five years, he would choose SK Hynix (SKHY) over Micron (MU). According to Counterpoint Research, SK Hynix accounted for 50% of global HBM revenue in the second quarter, nearly as much as Samsung and Micron combined, thanks to early investment in advanced memory packaging and manufacturing. The company began mass shipments of HBM4 in the second quarter and is developing HBM4E. Demand comes not only from Nvidia but also from AI hyperscalers such as Alphabet, Amazon, Microsoft, Meta, OpenAI and Anthropic, which are developing custom chips. The author notes that SK Hynix's valuation remains fairly modest on a forward P/E basis relative to its earnings growth.

Micron is benefiting from a memory chip shortage driven by AI data center demand, with revenue rising nearly 380% year over year in its latest quarter. The author argues the company is reducing the cyclicality of its business through multiyear take-or-pay contracts covering about 35% of revenue through 2030, along with new production facilities expected in mid-2027 and late 2028. The stock trades at 5.3 times fiscal 2027 earnings estimates, while Wall Street projects 16% growth for 2028; the author instead assumes 30% growth and a 20 times multiple, implying a price of $4,590 versus today's $920. According to the article, the market has not yet priced these changes into the stock.

Memory chips have historically moved in boom-and-bust cycles, and Micron trades at a forward P/E of just over 5 times fiscal 2027 estimates as investors expect the current AI-driven supercycle to eventually end. Micron has signed 26 strategic customer agreements covering about 35% of its sales through 2030, while China's CXMT has lifted its DRAM share from 4% in Q2 2025 to 10% in Q2 2026 and could add new supply. KeyBanc analysts reportedly see HP and Dell extending their deals into 2031 and Alphabet talking about extensions to 2035. In the near term, KeyBanc projects DRAM prices rising 15% to 20% quarter over quarter, with NAND prices up more than 20%.

The article argues Micron is the better AI chip stock compared with Taiwan Semiconductor Manufacturing, even though both are among the largest chip foundries by market cap. Micron makes memory chips with commodity-like pricing, while TSMC makes logic chips designed by companies such as Nvidia and AMD. Memory demand has outpaced supply and pushed prices sharply higher, and the shortage is expected to worsen in 2027 and 2028. Micron also has faster revenue growth and trades at 5.3 times forward earnings versus 24 for TSMC, a gap the author attributes to market doubts that the current memory demand wave will last. The author calls this valuation mismatch too large to ignore, while still considering TSMC a fantastic investment.

Micron (MU) closed at $931.24 on October 15, with an operating margin of 80.68% and revenue up 379.3% from the same quarter last year. The article says these figures look nothing like a commodity business, citing that only three companies supply nearly all the working memory used in advanced computing and that building a new plant is very costly. However, it argues Micron may lack a durable moat, since standard memory does not lock in customers who can buy from any of the three suppliers, and history shows prices collapse once supply catches up with demand. Capacity decisions made today take two or three years to arrive. The stock trades at 7.02 times next year's expected earnings against 24.78 times over the past year, meaning analysts expect earnings to climb steeply again.

Sandisk shares have surged 827% over the past year but dropped 44% from their June 22 52-week high, with fears over NAND flash demand, AI infrastructure spending and competition from China's CXMT. The author argues these fears are overblown, since CXMT doesn't make NAND flash and its DRAM technology reportedly trails Micron and SK Hynix. Enterprise SSD demand is booming on the back of the AI boom, with contract prices reportedly up 3x year over year, and McKinsey and IDC forecast annual growth of 35% and over 40% through 2030, respectively. Sandisk posted $20 billion in fiscal 2026 revenue with an 11% NAND market share, and its TAM is seen reaching $500 billion next year. The company targets mid-to-high teens annual revenue growth in fiscal 2028 to 2030 and a non-GAAP operating margin of 75% by fiscal 2030, versus 63% in fiscal 2026.