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‍# Micron Technology Plunges From Highs
Micron's stock price fell by more than 10%, drawing attention from the market. Over the previous 29 trading days, the stock had surged 147% in total—rising from around $500 all the way to nearly $800, setting a record high. Micron’s performance may be a microcosm of the recent U.S. tech stock Boomings. Before discussing why the stock price dropped sharply, we should first ask: why did it surge so much before?

‌1. Explosive AI demand‌: The four tech giants—Google, Amazon, Microsoft, and Meta—plan to spend a total of $725 billion on AI capital expenditures in 2026, a year-over-year increase of 77%, directly boosting demand for DRAM, NAND, and HBM (high-bandwidth memory).

‌2. Severe supply constraints‌: Micron’s HBM3E capacity is basically sold out by the end of 2026, highlighting global supply-chain bottlenecks. The company’s gross margin has at one point reached 58.54%, giving it very strong pricing power.

‌3. Structural shift‌: Micron successfully transitioned from a cyclical memory manufacturer to a core supplier of AI infrastructure. In fiscal year 2026 Q2, revenue reached $23.86 billion, up nearly 200% year over year, and the operating profit margin reached 67.6%.

‌4. Positive outlook from capital markets‌: Deutsche Bank and D.A. Davidson both issued a target price of $1,000, believing the long-term growth logic for AI storage has not changed.

Now let’s look at the reasons behind this drop.

1.‌ The short-term run-up was too large‌: The stock rose 147% over 29 trading days; the stock price is about 147% above the 200-day moving average. Technical indicators are in an “overbought” condition, creating selling-correction pressure.

‌2. Volatility in market sentiment‌: The U.S. chip sector overall is under pressure. The Philadelphia Semiconductor Index fell by more than 2.7%, and individual stocks such as Applied Optoelectronics and ARM dropped by more than 10%, creating a sector-wide spillover effect.

‌3. Profit-taking‌: Some investors chose to lock in gains at historical highs, especially with the AI rally overheating cyclically, causing funds to briefly pull back.

Finally, what will the future look like for tech stocks led by Micron? Is it time to buy the dip?

In the long run, AI demand for storage is sustained. By 2030, data centers are expected to consume 70% of the world’s storage production, so the supply-demand gap may persist. Although profitability may normalize in 2027–2028 due to competitors releasing capacity, emerging areas such as autonomous driving and IoT will lift storage demand from the “bottom.”

With continued tightness in DRAM and HBM demand, Micron—as a core supplier—has a gross margin of 58.54% and an operating profit margin of 67.6%, indicating strong fundamentals. In 2027, target prices are broadly expected to be as high as $1,100. Long-term investors don’t need to rush to buy the dip right now, but it’s worth keeping an eye on!