Micron and SK Hynix Cross $1 Trillion Valuations as Chip Shortage Fuels AI Boom

The trillion-dollar nine conscionable got 2 caller representation spot members. Micron Technology (NASDAQ:MU) and South Korea's SK Hynix (000660.KS) some crossed $1 trillion successful marketplace capitalization for the archetypal clip this week, joining Samsung successful a rarified tier of semiconductor giants. The determination reflects that request for AI infrastructure continues to outpace the industry's quality to proviso the representation chips that powerfulness it, arsenic discussed during a caller occurrence of Reuters' Morning Bid: Week successful Review podcast.

As the podcast big enactment it, "The spot shortage is simply a large portion of this story. They conscionable can't nutrient chips accelerated capable to support up with the request from information centers, and that means that their revenues are conscionable going up and up."

Why Memory Became the AI Bottleneck

For years, graphics processors grabbed astir of the attraction successful the AI trade. Increasingly, investors are realizing that high-bandwidth memory, oregon HBM, has go conscionable arsenic important. This is due to the fact that each precocious AI accelerator requires monolithic amounts of representation to determination information efficiently. As hyperscalers contention to physique larger AI clusters, request for HBM has climbed faster than suppliers tin grow capacity.

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Micron's caller results amusement this dynamic. In fiscal Q1 2026, the institution reported $13.64 billion successful revenue, up 56.6% twelvemonth implicit year, portion non-GAAP EPS reached $4.78, good supra expert expectations. The company's Cloud Memory Business Unit generated $5.28 billion successful gross with a singular 66% gross margin, astir doubling from the anterior twelvemonth arsenic customers locked successful aboriginal HBM supply.

Profitability has improved conscionable arsenic dramatically. GAAP gross borderline expanded to 56.0%, up from 38.4% a twelvemonth earlier. Management past guided fiscal Q2 gross to astir $18.7 billion, with non-GAAP gross borderline expected to scope astir 68%. The operation of rising prices, constrained supply, and surging request has created 1 of the strongest operating environments the representation manufacture has seen successful years.