Not Micron, Not Sandisk. This Chip Stock Could Be the Biggest Winner of the AI Memory Boom

Micron Technology and Sandisk person benefited importantly from the representation spot roar implicit the past year, arsenic the request for the dynamic random-access representation (DRAM) and NAND flash retention chips they manufacture has importantly exceeded supply.

Of course, investors person been rotating retired of representation stocks lately, arsenic evidenced by the 27% diminution successful the Roundhill Memory ETF implicit the past month. Both Micron and Sandisk person witnessed important pullbacks successful their banal prices implicit this period. However, the artificial quality (AI)-fueled representation spot request isn't going to slice distant immoderate clip soon.

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According to Deloitte, the representation crunch is improbable to easiness until 2029. While that's large quality for some Micron and Sandisk, determination is different institution that's benefiting from the unthinkable representation request -- Lam Research (NASDAQ: LRCX). Let's look astatine the reasons wherefore this semiconductor banal could go the biggest victor of the AI-driven representation boom.

The representation roar has fixed Lam Research a large changeable successful the limb

Lam Research sells the instrumentality that allows Micron and Sandisk to manufacture DRAM and NAND flash chips. The institution besides serves the foundry and logic extremity markets, though 46% of its gross comes from income of representation manufacturing equipment.

Deloitte estimates that the 3 largest representation makers successful the satellite -- Samsung, SK Hynix, and Micron -- are going to summation their combined superior expenditure by a whopping 340% betwixt 2024 and 2027. In all, the 3 companies could summation their capex to $146 cardinal successful 2027 from $58 cardinal successful 2025.

This explains wherefore Lam Research has been experiencing robust growth. The company's gross accrued by 26% twelvemonth implicit twelvemonth successful the precocious concluded fiscal 2026 (which ended connected June 28) to $23.2 billion. Its nett income jumped by 35% twelvemonth implicit twelvemonth to $7.26 billion. It ended the fiscal twelvemonth with a 30% year-over-year summation successful Q4 revenue, indicating accelerating growth.

Lam Research expects $8.1 cardinal successful gross for the existent quarter, on with non-GAAP net per stock of $2.15. That points to a year-over-year summation of 52% successful revenue, portion adjusted net are projected to leap by astir 71%. So, Lam seems connected way to timepiece overmuch faster maturation during the existent fiscal year, and it won't beryllium astonishing to spot it prolong specified terrific momentum implicit the agelong tally arsenic well.