NEW YORK, Jan 22, 2026, 07:31 ET — Premarket
- Micron shares climbed about 2.2% in pre-market after William Blair upgraded the stock to “Outperform.”
- The stock is climbing again following yesterday’s sharp rise, driven by soaring memory-chip prices linked to AI demand.
- Investors are balancing stronger pricing power with the risk that higher component costs might curb demand for PCs and smartphones.
Micron Technology (MU.O) shares jumped 2.2% to $397.75 in premarket Thursday after William Blair bumped its rating to “Outperform.” The move adds to a wave of target price hikes seen earlier this week. 1
This change matters now because Micron finds itself amid a volatile chip market: memory prices are climbing fast, potentially lifting supplier margins considerably. But those rising costs might also choke demand if PC and phone makers pull back on orders.
Investors are grappling with this shifting landscape while trying to predict the quarters ahead. Memory markets move in cycles, and momentum trades often flip when customers push back.
Micron jumped 6.6% on Wednesday, finishing at $389.11, near its recent highs after a volatile start to the year. 2
Memory supply shortages are intensifying, pushing prices even higher. AI infrastructure projects have gobbled up capacity, driving costs upward. Researchers now predict global smartphone shipments will fall at least 2% in 2026, while the PC market could contract by 4.9%, Reuters reports. Jacob Bourne from eMarketer cautions that these rising costs will hit consumers with steeper prices. Tobey Gonnerman of semiconductor distributor Fusion Worldwide revealed some products have seen price spikes of up to 1,000%. Apple reports earnings on Jan. 29, Dell follows on Feb. 26, and investors will be watching closely for comments on component costs and demand. 3
The warning comes directly from the hardware supply chain. Compal CEO Anthony Peter Bonadero called the current surge “a true super cycle (in memory chips) that we haven’t really seen.” He noted memory costs could jump to 35% to 40% of a PC’s materials expenses, up from about 15% to 18% previously. 4
Micron’s core offerings cover DRAM, the short-term “working memory” used in servers and PCs, plus NAND, a flash chip built for storage. Investors are paying close attention to high-bandwidth memory (HBM), a stacked DRAM type that boosts data transfer speeds alongside AI processors.
Micron is pushing to ramp up supply, though progress is gradual. This week, it revealed plans to acquire Powerchip’s P5 fab in Taiwan for $1.8 billion in cash. The move targets higher DRAM wafer production beginning in the latter half of 2027. The deal is expected to finalize by Q2 2026, subject to regulatory clearance. 5
Right now, the emphasis is on pricing and contracts rather than building new factories. “Spot” prices show what the market demands today, but big buyers usually rely on longer-term deals. These contracts may lag behind market shifts but typically catch up when supply stays tight.
The risk is clear. If higher prices curb demand, weaker unit sales could pull down orders for memory chips, even as suppliers focus on the more profitable AI server market. On top of that, a rapid capacity increase by producers might wipe out any price gains just as fast.
The key dates to watch: Apple speaks on Jan. 29, followed by Dell’s update on Feb. 26. Both will offer clues on demand, pricing trends, and component expenses. Investors want to know if the memory crunch is finally loosening as Q1 gets underway.
