Wall Street sees US memory maker Micron as the next Nvidia

Micron, the memory chip maker based in Boise, Idaho, has captured Wall Street's attention. Whether this enthusiasm lasts will largely depend on how long the AI-driven memory chip supply crunch continues.

Micron says it has strengthened its long-term position to handle a sudden drop in demand or a supply glut. Wall Street has bought into that story, briefly pushing Micron's market cap above Meta and Tesla for the first time on Thursday, before it slipped back by Friday to nearly match them.

Specifically, Micron ended Friday's session with a market cap near $1.27 trillion, compared to Meta's $1.39 trillion and Tesla's $1.42 trillion. Its stock has surged more than 236% in the past month alone, closing Friday at $1,132 per share. For years before mid-2025, it had traded below $100 per share.

This is a dizzying ascent for a company most consumers associate with the small memory cards once commonly used to expand PC, smartphone, or other device storage.

Wall Street isn't worried about that product line. Micron is riding the AI data center buildout boom, which has caused a shortage of system memory chips (DRAM and NAND) that Micron produces, especially High-Bandwidth Memory (HBM). A single AI server requires far more memory than a laptop.

AI system makers like Nvidia, along with hyperscalers building their own systems — such as Microsoft, Amazon AWS, Google, Meta, and Oracle — are buying up vast quantities of memory. This is pushing all other companies that need memory to stockpile it too, from PC makers like Dell and HP to other device manufacturers.

This supply shortage, dubbed "RAMageddon," is expected to persist into 2027. It's already driving up prices of consumer electronics like Apple products and Xbox consoles.

With the entire tech industry clamoring for more memory, Micron reported blockbuster third-quarter earnings last week. Revenue quadrupled year-over-year to $41.45 billion, while profits soared from $1.88 billion to $28.2 billion. Micron also gave a positive outlook, forecasting fourth-quarter revenue between $49 billion and $51 billion.

Wall Street, eager to find more publicly traded AI-related companies that could perform as well as Nvidia, became even more enamored with Micron.

The historic challenge for memory chip makers like Micron and Samsung is that expanding manufacturing facilities to boost capacity is a time-consuming, costly endeavor. Demand often falls just as companies are able to ramp up capacity, leading to a glut and subsequent price drops.

Micron preempted any talk of an AI bust by highlighting a series of long-term supply agreements, including with Nvidia and AI lab Anthropic, which should protect it. In its earnings presentation, the company said it has signed 16 strategic customer agreements across data center, consumer, and automotive market segments, agreements that it expects to fundamentally reshape its business model.

That appeared to convince several analysts that Micron could be another long-term, profitable investment. In a research note, William Blair tech analyst Sebastien Naji observed that demand growth continues to outpace the rate at which new cleanroom capacity can come online.

"Given the strong likelihood of continued ASP growth in the coming quarters and improving revenue visibility thanks to a rapidly expanding set of long-term agreements (SCAs) with key customers, we see potential for more durable earnings growth and reiterate our Outperform rating," Naji wrote.

Whether Micron can truly sustain itself long-term without a bust cycle remains to be seen. But for a brief moment on Thursday, this U.S. company was worth more than some of the industry's giants.