Micron and SK Hynix Cross $1 Trillion Valuations on AI Memory Surge

Quick Facts

• Micron stock jumped 19% after UBS tripled its price target to $1,525 per share, up 210% year-to-date
• SK Hynix shares surged 11% in South Korea, gaining over 1,000% in the past 12 months
• Both companies can only fulfill 50-67% of customer demand for high-bandwidth memory chips used in AI systems

Memory chipmakers Micron Technology Inc. and SK Hynix Inc. each crossed the $1 trillion market valuation threshold for the first time Wednesday. The milestone came as investors piled into stocks driven by surging demand for memory chips from artificial intelligence companies.

Micron’s stock jumped more than 19% after investment bank UBS tripled its price target from $535 to $1,525 per share. The company is now up 210% year-to-date and ranks as the 11th-largest US public company. SK Hynix rose 11% in South Korea trading, extending a rally that has seen shares gain over 1,000% in the past 12 months.

The surge reflects structural changes in the memory chip industry as data centers now consume an estimated 70% of all memory chips produced worldwide. SK Hynix becomes the third Asian company to reach a $1 trillion market cap, joining Samsung Electronics which crossed the same milestone earlier this month.

Supply Constraints Drive Pricing Power

Both companies face what Micron CEO Sanjay Mehrotra describes as “structural scarcity.” The three-company oligopoly of Samsung, SK Hynix and Micron controls over 95% of global DRAM production but can only fulfill 50% to 67% of customer demand for high-bandwidth memory chips used in AI accelerators.

UBS now expects high-bandwidth memory prices to rise 50% per gigabyte year-over-year, up from an earlier estimate of 35%. The investment bank projects Micron’s earnings per share will exceed $100 at least until 2029 based on long-term supply agreements that lock in pricing and demand visibility.

Micron reported record Q2 2026 results with revenue of $23.86 billion versus $8.05 billion in the same period last year. The company’s Cloud Memory Business Unit nearly doubled to $5.28 billion at 66% gross margins.

Long-Term Investment Cycle

The memory shortage stems from production constraints inherent in high-bandwidth memory manufacturing. A single HBM wafer displaces two or more conventional DRAM wafers due to larger die sizes and greater complexity, creating a net reduction in global memory supply even as wafer output remains constant.

High-bandwidth memory demand grew 130% year-over-year in 2025 and is projected to grow 70% in 2026. But 18-to-36-month capital expenditure cycles keep supply constrained throughout the period.

Micron is investing $24 billion in its Singapore fab while SK Hynix commits $13 billion to a new plant in South Korea. These facilities target immediate AI-driven demand as Big Tech capital expenditure is projected to reach $725 billion.

“We believe the market will start to put a more normal multiple on the stock,” said UBS analyst Timothy Arcuri. The firm’s new target implies Micron could reach a $1.8 trillion valuation within 12 months.

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