Micron shares surged nearly eight percent on Friday as investors moved quickly to buy into companies linked to the artificial intelligence supply chain.
The rally followed robust earnings from Taiwan Semiconductor Manufacturing Company, which signalled continued and accelerating investment in AI infrastructure.
Micron, a key supplier of memory and storage components for artificial intelligence systems, has seen its stock rise more than 250 percent over the past year.
The surge reflects growing pressure on global memory supply as AI-related demand continues to outpace production capacity.
Memory Shortage Fuels Growth
Memory plays a critical role in AI systems, allowing vast volumes of data to sit close to graphics processing units without slowing performance.
As companies deploy larger and more complex AI models, demand for high-performance memory has intensified worldwide.
This imbalance has created a shortage that is pushing prices higher across the sector.
Micron’s leadership believes this trend is only accelerating.
“AI driven-demand is accelerating,” Micron CEO Sanjay Mehrotra told CNBC’s Jim Cramer.
“It is real. It is here, and we need more and more memory to address that demand.”
Massive US Expansion Underway
Mehrotra revealed that Micron is committing approximately $200 billion to expand its manufacturing capacity across the United States.
The investment includes two fabrication plants in Idaho and a 600,000-square-foot facility in Clay, New York.
The New York project officially broke ground on Friday, with Commerce Secretary Howard Lutnick attending the ceremony.
Micron said it would invest $100 billion into that single fabrication plant alone.
Mehrotra noted that building the facilities would take several years due to the complexity of clean rooms and advanced production equipment.
Stronger-Than-Expected Demand
Micron also reported stronger growth than initially forecast across multiple product segments.
At the start of 2025, the company projected server memory growth of around ten percent.
By the end of the year, that figure had increased to the high-teens.
Demand for memory and storage used in personal computers also exceeded expectations.
“We see that tightness continuing into 2027, so we see durable industry fundamentals over the foreseeable future, driven by AI demand,” Mehrotra said.
Prices Expected To Rise
The rush to supply memory for companies such as Nvidia, Advanced Micro Devices, and Google has intensified supply pressures.
As a result, prices for essential memory components are expected to rise by an estimated 55 percent in the first quarter.
Investors appear increasingly confident that AI-driven demand will support sustained growth across the sector.
