AI The continuous demand for training and inference has pushed up the usage of high bandwidth and memory ( HBM ), making Micron, a storage chip manufacturer, one of the strongest-performing companies in the semiconductor sector of the US stock market over the past five years. According to the data cited in the article, Micron closed at $1016.59 last Friday, with a cumulative increase of about 1313% over five years, which is higher than NVIDIA's return of about 912% during the same period.
In five years, the increase has surpassed that of most large tech stocks.
This round of growth is also reflected in the company's market value. The article states that Micron's market value has risen from approximately $104.2 billion at the end of 2021 to around $1.15 trillion today, an increase of over $1 trillion. If compared with the current list of components of the S&P 500 index, some companies that were only included in the index in recent years have seen even greater gains. However, if we only look at the large technology stocks that have remained in the index over a longer period, Micron's performance is still very outstanding.
The article mentions that Sandisk and Comfort Systems USA have performed better over the past five years, but neither company was a constituent of the S&P 500 index throughout the entire statistical period. Therefore, their performance cannot be directly compared to that of long-term S&P 500 constituents such as Micron and NVIDIA.
AI Changes the Pricing Power of Memory Chips
The core factor driving Micron to re-evaluate its strategy is the rapid increase in demand for HBM from AI servers. HBM is an important component of AI accelerators, and advanced GPU applications require higher bandwidth and faster-response storage to handle large-scale data.
The article cites industry analysis stating that currently, the demand for HBM has exceeded twice the available supply. Micron plans to increase the monthly production capacity of HBM wafers to about 100,000 by the end of this year, which is a significant expansion from before. The tight supply also gives related products stronger bargaining power.
Revenues surge significantly, market focuses on the next financial reporting milestone
Driven by demand, Micron's performance in its latest fiscal quarter has significantly strengthened. The article states that the company's revenue in the third fiscal quarter reached a record $41.46 billion, compared to $9.3 billion in the same period last year. Wall Street's view of the storage industry has also changed accordingly; more and more investors are beginning to regard storage as part of the AI infrastructure, rather than just a traditional cyclical semiconductor business.
However, the market has not completely ignored the risks. The article points out that the storage industry still has cyclical characteristics. If Micron, Samsung Electronics, and SK SK Hynix release additional production capacity in the future, it could lead to a rebound in supply; if AI capital spending slows down, prices may also come under pressure soon.
Micron's next performance test will come on September 30th. For investors, the focus will shift to whether the supply and demand of HBM will remain tight, as well as whether the related revenue of AI can continue its current upward trend.
