Micron Technology jumped more than 5% Thursday after Intel CEO Lip-Bu Tan warned the global memory chip shortage could worsen next year, extending a rally that also lifted Intel, Marvell and AMD. Micron's fiscal third-quarter results already show tight supply pushing prices and margins higher.
Micron Technology jumped more than 5% Thursday as memory stocks rallied, two days after Intel Chief Executive Lip-Bu Tan warned that the memory shortage could worsen next year. SK hynix also gained about 5%, while the Nasdaq rose more than 1% as the broader market rallied following Wednesday's Federal Reserve decision. The company reports fiscal fourth-quarter results on Sept. 30, when investors get the next read on whether the shortage is still pushing prices and margins higher.
Tan Warns Memory Pressure Could Worsen in 2027
Tan made the comments Tuesday at the AI Infrastructure Summit in Santa Clara. Memory chip prices have climbed between five and seven times as limited supply struggles to keep pace with AI demand, and Tan added that the bottleneck could worsen next year.
The warning echoes concern across the memory industry. SK hynix CEO Kwak Noh-jung told Reuters in July that 2027 would be the worst year in the industry's history for supply. TrendForce, meanwhile, estimates server DRAM contract prices rose 64% in the second half of 2025 and could climb another 270% during 2026.
Chip Rally Broadens Across the Sector
The rally extended well beyond Micron. Intel shares soared 8.3% Thursday morning, while Marvell Technology and Advanced Micro Devices rose 5% and 4.9%, respectively. Arm Holdings' U.S.-listed shares were up 6.7% in morning trading. Investor fears about an AI spending slowdown and the impact of interest-rate increases are subsiding, according to MarketWatch, as chip stocks continue their comeback from a selloff earlier in the week.
Record Results Set Up Micron's Next Report
Micron is already turning tight supply into sharply higher profits. Fiscal third-quarter revenue reached $41.46 billion, up from $9.30 billion a year earlier, while non-GAAP gross margin hit 84.9%. The company guided to roughly $50 billion in fourth-quarter revenue and an 86% gross margin.
The company said in June that 14 of its first 16 strategic customer agreements carried about $100 billion in minimum contracted revenue, with price bands designed to give Micron and customers more visibility through the memory cycle. TrendForce expects memory pricing to stay elevated in 2027 even as new supply comes online.
Sources: Benzinga, MarketWatch (snippet-based)
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