Micron Market Value Surpasses $700 Billion for the First Time

Micron Technology soared by over 11% on May 5th, with the immediate catalyst being CEO Sanjay Mehrotra's public statement: "The supply and demand gap for memory has just begun." This statement, along with the company's simultaneous announcement of the shipment of the 245TB Micron 6600 ION solid-state drive, set off a collective rally in the semiconductor sector.

A Single Sentence Ignites Price Reassessment

Mehrotra's statement is straightforward: the demand for storage fueled by AI is not only accelerating but also requires larger-scale storage; on the supply side, due to the lengthy cycle of capacity expansion, the earliest production of new fabs will have to wait until FY2027-28, with price elasticity being virtually zero for a considerable period of time.

This clear determination of the supply and demand structure has left little room for dispute in the market regarding Micron's pricing power in the coming quarters. Meanwhile, the formal mass production and shipment of the 245TB Micron 6600 ION SSD—based on Micron's proprietary QLC NAND technology, with a single-disk capacity of a quarter of a petabyte, designed for hyperscale cloud and AI data centers—has turned the growth logic, which was previously only present in financial narratives, into a tangible delivery, further reinforcing the market's confidence in its technology roadmap.

SK Hynix Takes the Lead

Micron's rise is not isolated. The trading day before, South Korea's SK Hynix had already surged by over 11%, providing an emotional base for the entire memory sector.

JPMorgan TMT's trading desk review points out that the fermentation of the risk of strikes by Samsung workers has led the market to directly transfer the premium of potential supply contraction onto Micron and Hynix; the earnings season for hyperscale cloud providers (CSP) has just ended, and the confirmation of accelerated AI capital expenditure is still driving the continuous repricing of the semiconductor segment.

In addition, there are rumors that Micron's management is on the roadshow in Europe, coupled with the continuous inflow of funds into the DRAM ETF, which provides additional support at the technical level. The Philadelphia Semiconductor Index (SOXX) rose by more than 4.5% overall, and JPMorgan described it as a "comprehensive explosion of semiconductors, memory, AI infrastructure," with Micron being one of the most price-elastic targets.

Mag7 Earnings Reports Confirm: Memory at the Forefront of AI Demand

The real macro anchor of this market trend comes from the recently concluded Q1 earnings season of hyperscale cloud providers.

• Google's Q1 capital expenditure was $35.7 billion, with full-year guidance raised to $180-190 billion, and it is clear that spending in 2027 will be "significantly higher."

• Microsoft's Q1 capital expenditure was $31.9 billion, with Q4 single-quarter guidance exceeding $40 billion;

• Amazon's Q1 net PPE procurement reached $44.2 billion;

• Meta also raised its full-year capital expenditure guidance.

JPMorgan's strategy team repeatedly emphasized in the morning briefing from May 4th to 5th that "the Mag7's stance continues to validate the upward cycle of capital expenditure, which directly supports the semiconductor segment." For memory, HBM and server DRAM are irreplaceable foundational components in AI computing architecture, making Micron's profitability visibility one of the highest in the entire semiconductor segment.

Optimistic Expectations Already Deeply Priced In

The current market has a certain degree of linear extrapolation regarding the logic of "AI capital expenditure materializing into memory demand." Should any CSP issue a signal to pause or cut CapEx, memory stocks, as the most direct承接方 on the demand chain, will be the first to be impacted.

Morgan Stanley's bear scenario also clearly warns that if the pseudo-demand from inventory replenishment at the beginning of 2027 is exposed, valuation multiples will face severe compression. Under the target price framework, Micron still has room to rise, but the safety margin must be strictly tied to the entry point, as optimistic expectations are already part of the current valuation.