Micron Partners with Applied Materials to Accelerate AI Memory Development
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy MU?
Source: Fool
- Accelerated Memory Development: Micron Technology and Applied Materials announced a partnership to expedite the development of advanced memory, particularly DRAM and NAND storage for AI applications, aiming to meet the surging market demand and enhance the company's competitive position.
- Significant Stock Surge: Following this announcement, Micron's stock rose by 5.1% to $17.77 per share, reflecting market optimism regarding its future growth potential, especially against the backdrop of strong demand in the AI sector.
- Deepened R&D Collaboration: The two companies will share their engineering teams' research efforts, focusing on the development of next-generation materials and process technologies, which not only strengthens the semiconductor innovation pipeline in the U.S. but also lays a foundation for Micron's sustained growth in the AI market.
- Optimistic Financial Outlook: Micron expects to report second-quarter results on March 18, with projected revenue of $18.7 billion and non-GAAP diluted EPS of $8.42, representing a substantial increase from last year's $8 billion and $1.56, indicating robust growth driven by AI demand.
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Analyst Views on MU
Wall Street analysts forecast MU stock price to fall
26 Analyst Rating
24 Buy
2 Hold
0 Sell
Strong Buy
Current: 403.110
Low
235.00
Averages
336.12
High
500.00
Current: 403.110
Low
235.00
Averages
336.12
High
500.00
About MU
Micron Technology, Inc. provides memory and storage solutions. The Company delivers a portfolio of high-performance dynamic random-access memory (DRAM), NAND, and NOR memory and storage products through its Micron and Crucial brands. The Company's products enable advancing in artificial intelligence (AI) and compute-intensive applications. Its segments include Compute and Networking Business Unit (CNBU), Mobile Business Unit (MBU), Embedded Business Unit (EBU), and Storage Business Unit (SBU). CNBU segment includes memory products and solutions sold into the data center, PC, graphics, and networking markets. MBU segment includes memory and storage products sold into the smartphone and other mobile-device markets. EBU segment includes memory and storage products and solutions sold into the intelligent edge through the automotive, industrial, and consumer embedded markets. SBU segment includes SSDs and component-level storage solutions sold into the data center, PC, and consumer markets.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Memory Price Forecast: Citi analysts project that DRAM average selling prices will increase by 171% year-over-year by 2026, with NAND prices also expected to rise by 127%, driven by robust demand from data centers and eSSD, highlighting Micron's competitive position in the market.
- Market Cycle Analysis: Analysts noted that the key investor debate surrounding Micron is whether we are in an extended memory cycle akin to the 1990s Windows PC DRAM cycle, particularly given strong AI demand and limited new fab capacity, which could impact future price trends.
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- Memory Price Forecast: Citi analysts project that DRAM average selling prices will increase by 171% year-over-year by 2026, with NAND prices also expected to rise by 127%, driven by robust demand from data centers and eSSD, highlighting Micron's competitive position in the market.
- Market Cycle Analysis: Analysts noted that the key investor debate surrounding Micron is whether we are in an extended memory cycle akin to the 1990s Windows PC DRAM cycle, particularly given strong AI demand and limited new fab capacity, which could impact future price trends.
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- Optimistic Outlook for Amazon: Analysts set a $300 price target for Amazon, believing its high-margin businesses will drive greater profits and support investments in last-mile delivery and cloud services, despite a recent 7% stock drop due to quarterly earnings misses.
- Strong Demand for Nvidia: Morgan Stanley remains bullish on Nvidia, with analysts noting robust demand for its Blackwell chip series, which is expected to continue pushing upward estimates, while the upcoming Rubin platform is anticipated to maintain Nvidia's leadership in AI computing architecture.
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- Supply Chain Diversification: By partnering with Taiwan Semiconductor for chip manufacturing, Meta has increased the diversity of its silicon supply, reducing reliance on market price fluctuations and enhancing cost efficiency.
- Data Center Expansion: The 5-gigawatt data center being built in Louisiana is part of Meta's expansion plans, expected to support future AI workloads and further solidify its position in the cloud computing market.
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