NEW YORK, Jan 22, 2026, 07:31 ET — Premarket
- Micron shares jumped roughly 2.2% in pre-market trading following a new “Outperform” rating from William Blair.
- The stock is pushing higher again after yesterday’s big jump, fueled by rising memory-chip prices tied to AI demand.
- Investors weigh stronger pricing power against the threat that rising component costs could dampen demand for PCs and smartphones.
Micron Technology (MU.O) shares climbed 2.2% to $397.75 in premarket trading Thursday, following William Blair’s new “Outperform” rating. This comes amid a streak of target price upgrades earlier this week. (Public)
This shift is significant now as Micron is caught in the middle of a turbulent chip market: memory prices are surging, which could boost supplier margins sharply. Yet, those higher prices risk curbing demand if manufacturers of PCs and phones decide to scale back their orders.
Investors are wrestling with that very dynamic as they try to forecast the coming quarters. Memory markets run in cycles, and momentum trades often reverse once customers begin to resist.
Micron surged 6.6% Wednesday, closing at $389.11, hovering close to its recent peaks following a choppy start to the year. (Investing)
The memory supply crunch is tightening further, driving prices higher. AI infrastructure projects have soaked up capacity, pushing costs up. Researchers now forecast a drop in global smartphone shipments of at least 2% in 2026, with the PC market expected to shrink by at least 4.9%, according to Reuters. eMarketer’s Jacob Bourne warned that higher costs will translate into “higher prices for consumers.” Meanwhile, Tobey Gonnerman from semiconductor distributor Fusion Worldwide reported “1,000% price inflation in some products.” Apple’s earnings come out Jan. 29, Dell’s on Feb. 26, and investors will be focused on any remarks about component costs and demand. (Reuters)
The warning is coming straight from the hardware supply chain. Compal CEO Anthony Peter Bonadero described the current surge as “a true super cycle (in memory chips) that we haven’t really seen.” He added that memory costs could climb to 35% to 40% of a PC’s materials expenses, compared to around 15% to 18% before. (Reuters)
Micron’s main products include DRAM, the short-term “working memory” powering servers and PCs, and NAND, a flash chip designed for storage. Investors are also zeroing in on high-bandwidth memory (HBM), a stacked DRAM variant that speeds up data transfer alongside AI processors.
Micron is working to boost supply, but it’s a slow process. This week, the company announced a letter of intent to buy Powerchip’s P5 fab in Taiwan for $1.8 billion in cash. The acquisition aims to raise DRAM wafer output starting in the second half of 2027. The deal is slated to close by Q2 2026, pending regulatory approval. (Reuters)
For now, the focus isn’t on new factories but on pricing and contracts. “Spot” pricing reflects current market rates, while major buyers mostly stick to longer-term contracts. These contracts can lag but tend to adjust once supply remains constrained.
The downside is straightforward. Should rising sticker prices hit demand, weaker unit sales might drag down orders for memory chips, despite suppliers targeting the higher-margin AI server segment. Plus, if producers ramp up capacity too fast, that price boost could evaporate just as quickly.
The upcoming triggers are straightforward: Apple’s comments on Jan. 29 and Dell’s update on Feb. 26 will be closely watched for insights on demand, pricing, and component costs. Investors will be looking to see if the memory shortage starts to ease as the first quarter kicks off.
