Micron stock surges on new Taiwan factory investment, strong earnings expected on Wednesday

Micron Technology (MU) banal surged by much than 5% done midday trading connected Monday aft the integer representation and retention supplier announced plans to physique a 2nd spot manufacturing installation successful Taiwan.

The caller spot installation volition beryllium built astatine a recently acquired tract from Powerchip Semiconductor Manufacturing Corp., and it volition nutrient cutting-edge DRAM products, specified arsenic high-bandwidth representation (HBM), to conscionable AI demand.

Investors were besides preparing for the company's fiscal second-quarter net study owed aft the closing doorbell connected Wednesday.

Micron is expected to study $19.3 cardinal successful revenue, according to estimates compiled by S&P Global Market Intelligence, representing maturation of much than 40% quarter-on-quarter and much than 130% year-on-year. Analysts are estimating adjusted net of $8.66 per share, much than 80% implicit the anterior 4th and much than 450% higher than a twelvemonth ago.

Shares successful Micron, the largest American shaper of representation chips, are up much than 340% year-on-year. At the aforesaid clip arsenic the institution is investing its caller Taiwan facility, Micron is besides spending $50 cardinal to treble the size of its manufacturing installation successful Boise, Idaho, wherever the institution is based.

The operation volition see 2 caller spot fabrication facilities, The Wall Street Journal reported.

S&P Global expert Melissa Otto noted successful a caller memo that stocks specified arsenic Micron and Sandisk (SNDK), which are up much than 1,200% from a twelvemonth ago, person heavy benefited from the rotation retired of bundle into memory, which is poised to beryllium a ample beneficiary of the AI roar and related thrust for computing power.

Memory chips are cardinal components of the information centers that Big Tech is readying to walk hundreds of billions of dollars gathering retired successful 2026 arsenic the request for AI continues to surge. The processing chips designed by companies similar Nvidia and AMD necessitate expanding amounts of representation chips to function.

"MU’s continued beardown technological execution and subject connected capex is resulting successful what we presumption to beryllium a paradigm displacement successful the representation sector," Deutsche Bank expert Melissa Weathers wrote successful a caller lawsuit note.

She added: "We are seeing stronger grounds of a representation manufacture that is structurally debased connected supply, which could prolong for aggregate years to come."

Jake Conley is simply a breaking quality newsman covering US equities for Yahoo Finance. Follow him connected X astatine @byjakeconley oregon email him astatine jake.co[email protected].