Micron Stock Surges on AI Demand and Analyst Upgrades
Today, shares of Micron Technology, the well-known memory chip maker, experienced a notable rally, climbing as much as 5.2% before settling around a 3.5% gain by the close of trading. This surge was fueled by a combination of strong analyst sentiment and optimism around AI-driven demand, which has investors excited about the company’s future prospects.
Yesterday, Citigroup issued a bullish note on Micron, reaffirming a “buy” rating and highlighting that the memory market is expected to remain in undersupply through 2026. Analysts suggested that the growth in DRAM demand will outpace supply growth by nearly two percentage points. Surprisingly, even NAND flash memory—which has faced oversupply in recent years—was projected to see demand exceed supply by about four percentage points. These insights helped set the stage for today’s market enthusiasm.
Adding to the momentum, Oracle’s recent earnings call brought AI-related infrastructure into focus. Chairman Larry Ellison emphasized the enormous potential of AI inferencing, describing it as a market that could “change everything.” Oracle revealed that its remaining performance obligations, essentially its backlog of committed revenue, surged 359% to $455 billion. The company also forecasted that its cloud infrastructure revenue could rise from $18 billion this year to a staggering $144 billion by 2030. This forward-looking guidance sparked excitement across AI infrastructure stocks, including Micron.
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The connection between Citigroup’s note and Oracle’s announcement lies in AI inferencing. Citigroup pointed out that as AI demand shifts from high-bandwidth memory needed for training to DRAM and NAND chips used in inferencing and edge devices, memory demand across the board would grow significantly. Essentially, AI isn’t just about training large models anymore; the inferencing phase—where AI makes predictions in real-time—is expected to create a long-lasting boost in memory requirements.
Micron has positioned itself well to benefit from this trend. Over the past decade, the company has developed technology that rivals or surpasses many competitors, which comes at a perfect time as AI adoption accelerates. Although the memory business is traditionally capital-intensive and cyclical, the sustained demand driven by AI could support both pricing and volumes over the medium term.
Looking ahead, analysts at Citi anticipate that Micron will provide stronger-than-expected guidance for its data center business when it reports fourth-quarter fiscal 2025 results later this month. Early trading saw Micron shares edge up about 5%, reflecting investor confidence in the company’s position in the AI-driven memory market.
In short, Micron’s recent rally can be attributed to the convergence of positive analyst commentary, record-breaking AI-related demand forecasts from Oracle, and the company’s strong technological positioning. With AI continuing to reshape the technology landscape, Micron appears to be in a favorable spot to capitalize on the growing need for high-performance memory solutions.
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