Key Points:
- Micron’s stock surged due to high demand for memory in AI chips.
- The AI boom causes a severe shortage of memory chips.
- Nvidia’s new GPUs require significantly more memory, boosting Micron’s sales.
- Memory shortages will likely continue for several years.
Micron’s stock has seen incredible growth, tripling in 2025 and rising almost 62% so far in 2026. This surge comes from the massive demand for memory-rich Nvidia AI chips, which has led to widespread shortages. While this memory crunch boosts Micron, it hurts many other tech companies facing higher prices for crucial components. Micron is the only one among the top 10 most valuable U.S. tech companies to see such growth this year, pushing its market value to $520 billion, surpassing Oracle.
Micron will release its fiscal second-quarter results today, with analysts expecting a huge 148% jump in revenue compared to last year. The memory chip shortage shows no signs of slowing down, as major tech companies spend record amounts to stay competitive in the AI race.
Micron CEO Sanjay Mehrotra explained in January that “Memory is a key enabler of AI. It is a strategic asset today… Just like your brain, you need more memory. You need faster memory.” Companies like Amazon and Google, which use many Nvidia chips for their cloud services, are significantly increasing their spending.
Cloud providers need tons of Nvidia’s Vera Rubin graphics processing units (GPUs) in their data centers, and each system demands a lot of memory. For example, an Nvidia Vera Rubin NVL72 system uses about three times the DRAM (dynamic random access memory) as the Grace Blackwell GB300 NVL72 rack. A single Rubin Ultra GPU will have a massive terabyte of high-performance HBM4e memory, over three times as much as a single Rubin GPU.
Nvidia CEO Jensen Huang predicted $1 trillion in purchase orders for Blackwell and Vera Rubin GPUs through 2027. This high demand directly benefits Micron, which reported in December that its high-bandwidth memory for 2026 is already sold out. The chairman of SK Hynix, a Micron rival, believes the memory shortage will last another four or five years.
Analysts expect Micron’s average DRAM selling prices to have climbed almost 32% last quarter. For the next quarter, they anticipate an adjusted gross margin over 71% and revenue of $23.80 billion, an increase of nearly 156%.
The stockpiling of GPUs has also driven up memory prices for other products. A report from TrendForce stated that PC DRAM contract prices “surged significantly this quarter,” with blended DRAM pricing set to jump 80% to 85% in the first quarter of 2026. This could lead to a decline in PC and smartphone sales, with IDC forecasting an 11.3% drop in PC sales and a 12.9% drop in smartphone shipments this year. IDC research manager Jitesh Ubrani believes “Memory shortages will persist well into 2027.”
Dell has also warned about rising memory costs, with its operating chief stating that DRAM costs have increased five-and-a-halffold in the last six months, and NAND flash memory costs are four times higher. Dell is working with its memory partners to be flexible and agile, minimize complexity, improve product mix, and adapt designs to available parts.
Micron is taking steps to increase supply. In January, they broke ground on future fabrication plants in upstate New York, and last month, they opened an assembly and test facility in India.
