Micron Rallies as AI Memory Crunch Lifts Margins

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Micron Rallies as AI Memory Crunch Lifts Margins

Faizan Farooque

Wed, February 18, 2026 at 8:26 AM GMT+9 1 min read

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    MU

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This article first appeared on GuruFocus.

Micron (MU, Financials) has climbed about 44% so far this year as accelerating artificial intelligence demand tightens supplies of high-bandwidth memory and server DRAM, boosting pricing power and profitability.

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The corporation is spending a lot of money to increase production. Micron wants to spend approximately $50 billion to create two new chip facilities and make its Boise, Idaho, campus bigger.

The first one should start making silicon wafers in the middle of 2027, and both should be up and running by the end of 2028. Micron is also building a factory in Syracuse, New York, that will cost around $100 billion. The company is also looking for more capacity overseas, including a $9.6 billion project in Japan.

Micron executives say AI workloads are driving a step-change in memory requirements across systems powered by chips from Nvidia, AMD and Broadcom. As the company shifts toward higher-value products such as HBM, its gross margin has risen sharply and is projected to reach 68% this quarter, near levels seen at leading AI hardware vendors.

The company still faces the industry’s historical boom-and-bust risk, but management says some customers are seeking longer-term supply commitments as shortages persist.

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