Micron CEO Sanjay Mehrotra Sees Tight Memory Past 2026
By Reuters | 18 Dec, 2025

Micron Technology shares jumped 16% Thursday as demand for advanced memory chips for AI and smartphones far exceeds global production capacity.

Micron Technology shares rose nearly 16% on Thursday, following an outsized profit forecast on the back of a worldwide supply crunch of memory chips amid robust demand from AI data centres. 

A memory shortage across industries - from smartphones to sprawling data centres - has boosted prices, prompting Micron to forecast second-quarter adjusted profit at nearly double of Wall Street expectations.

This dynamic "is boosting incredible market pricing for Micron and its memory chip peers," Morningstar analysts wrote in a note. 

"The current cyclical upswing is generating tremendous shareholder value."

Micron is one of only three major suppliers of high bandwidth memory (HBM) chips essential to AI technology, alongside South Korea's Samsung and SK Hynix.

Micron's share price has risen over 160% this year, while Samsung and SK Hyninx's South Korea-listed shares have more than doubled and tripled in value, respectively. 

Micron is set to add over $40 billion to its market capitalization, if gains hold. 

BALANCING DEMAND-SUPPLY DYNAMICS

Micron CEO Sanjay Mehrotra has said he expects memory markets to remain tight past 2026.

Memory is a highly cyclical industry, characteristically experiencing extreme downturns and highs with volatile pricing levels. 

While analysts differ in their estimates of how long the ongoing upturn, routinely referred to as the "supercycle", might last, Wall Street unanimously agrees supply shortages could extend beyond Micron's estimates despite efforts to expand capacity. 

The memory chip maker has increased its 2026 capital expenditure plans to $20 billion, as it ramps up investments to meet booming demand. 

Still, Morningstar analysts see supply tightness persisting well into 2027. J.P. Morgan analysts also expect the supply shortage to last through 2027, while Micron balances between supplying to data centres and key customers in other industries such as Apple. 

Global smartphone shipments are expected to decline 2.1% next year as rising chip costs could impact demand, research firm Counterpoint said on Tuesday.

Handset providers such as Apple and Samsung are likely to continue having relatively stable access to memory chips, D.A. Davidson analyst Gil Luria said, adding that other "lower-value" Android-based handset providers, conversely, are susceptible to facing shortages due to their lower cost memory content. 

(Reporting by Akriti Shah, Siddarth S and Arsheeya Bajwa in Bengaluru; additional reporting by Danilo Masoni in London; editing by Samuel Indyk, Mrigank Dhaniwala and Krishna Chandra Eluri)