Micron: Memory Chip Demand to Continue Beyond 2027

(CNA) - New York, June 24) US memory chip giant Micron Technology announced its earnings today, with revenue and profits exceeding analyst expectations, leading to a rise in its stock price in after-hours trading. Micron estimates that market demand will continue to far exceed supply, and the shortage of memory chips driven by the AI wave will persist beyond 2027.

US High Bandwidth Memory (HBM) leader Micron Technology announced its earnings today. In the third quarter, revenue reached $41.46 billion, exceeding the previous forecast of $35.84 billion and quadrupling from the same period last year. Adjusted earnings per share were $25.11.

Micron's financial report indicated that its revenue forecast for the fourth quarter is between $49 billion and $51 billion, higher than analysts' prediction of $43.5 billion. Micron's stock price saw no significant fluctuations before the earnings announcement today, but rose by approximately 15% in after-hours trading following the release of the better-than-expected financial report.

Benefiting from the massive demand for high-performance memory chips from artificial intelligence computing centers, high bandwidth memory chips are in short supply. This has squeezed the supply for smartphones, computers, and other electronic equipment, leading to year-on-year price increases for chips and driving up the cost of consumer electronics. Micron's stock price has grown by over 700% in one year, with its market capitalization at one point ranking among the top 10 global companies.

Micron expects the AI-driven demand for memory chips to continue beyond 2027, and the company has signed 16 long-term contracts ranging from 3 to 5 years with data center operators, automotive manufacturers, and other businesses.

Influenced by Micron's earnings report and the recent overheating of chip industry stock prices, another US memory company, SanDisk, saw its stock price fall by 2.5% at the close on the 24th, but continued to rise in after-hours trading.

Big data companies such as Google, Amazon, and Meta, and artificial intelligence application startups like OpenAI and Anthropic, have recently made substantial investments in artificial intelligence data and computing centers. High bandwidth memory is a core component of graphics processing unit (GPU) architecture, and the enormous demand has dominated the global market, triggering an international investment wave in recent years.

South Korean giants SK Hynix and Samsung Electronics account for about 70% of the global dynamic random-access memory (DRAM) production capacity. AI demand has simultaneously boosted the stock prices of both companies and sparked an investment boom in the South Korean stock market. (Editor: Wei Shu) 06/25/115

Stand with facts, your every donation is a force to protect press freedom

Download the CNA "One News" APP to get the latest news in real-time

Text, images, and videos on this website may not be reproduced, publicly broadcast, publicly transmitted, or used without authorization.