Micron’s $250 Billion US Pledge and $22 Billion in Auto Contracts Can’t Shield the Stock From SK Hynix’s Nasdaq Debut
Published on 07/11/2026 at 20:13 | Redaktion boerse-global.de
Micron Technology is in the middle of a contradictory stretch. The memory-chip giant has just raised its long-term US investment target to $250 billion through 2035, secured $22 billion in strategic automotive contracts, and reported quarterly revenue that smashed analyst expectations. Yet the stock fell 6% last week and sits 22% below its June record high. The culprit appears to be a familiar rival knocking on Wall Street’s door.
On July 9, CEO Sanjay Mehrotra unveiled an expanded capital-spending roadmap that adds $50 billion to the $200 billion figure floated just a month earlier. The centerpiece is a sprawling complex in Clay, New York, where the first concrete was poured more than a quarter ahead of schedule — a milestone that shifts the project from site preparation to active construction. Combined with existing and expanded facilities in Idaho and Virginia, Micron aims to produce 40% of the world’s DRAM on US soil. The broader buildout is expected to create roughly 100,000 domestic jobs, with a significant concentration in New York state.
Two days later, Micron announced it had signed long-term supply agreements with General Motors and Ford as part of a larger portfolio of 16 “take-or-pay” customer contracts worth a combined $22 billion. These deals cover specialised memory solutions such as LPDRAM and UFS-NAND, components essential for next-generation vehicle architectures and autonomous driving. The take-or-pay structure insulates Micron from spot-market volatility and provides predictable revenue streams — a deliberate hedge against the cyclical swings that have long plagued the memory industry.
The strategic diversification comes at a time when the core AI-driven business is also firing on all cylinders. Micron’s fiscal third-quarter revenue hit $41.46 billion, well above the consensus estimate of $35.7 billion, while adjusted earnings per share of $25.11 easily topped the $21.39 forecast. For the current quarter, management guided for revenue of roughly $50 billion, EPS between $30 and $32, and a gross margin of 86%. Analysts responded with a flurry of bullish price targets: Bank of America at $1,550, Susquehanna and Barclays at $2,000, and JPMorgan at $1,540. UBS reported a 31% monthly jump in HBM sales and expects supply tightness in memory chips to persist through at least mid-2028, aided by constrained output from Samsung, SK Hynix, and Micron itself.
Should investors sell immediately? Or is it worth buying Micron?
Not everyone is convinced the rally has legs. Simply Wall St calculates fair value at $507.88 per share, arguing the stock’s price-to-earnings ratio of 21.9 — versus a sector average of 65.1 — signals overvaluation. Investor Michael Burry is reported to still hold a short position. And while Barclays pegs the potential market for humanoid robots, which Mehrotra has flagged as a possible larger growth driver than data centres, at more than $200 billion over the next decade, the stock’s 218% year-to-date surge has already priced in considerable optimism.
That optimism was put to the test last week when SK Hynix, the South Korean memory rival, made its Nasdaq debut on July 10. The IPO gave institutional investors a pure-play AI memory alternative, prompting profit-taking in Micron and a rotation of capital into the new listing. Reports that Apple is raising hardware prices due to rising component costs added to jitters about consumer demand outside the hyperscale data-centre segment, even though Micron’s high-bandwidth memory capacity is reportedly sold out through 2027.
Technically, the pullback looks more like a consolidation than a trend reversal. The stock closed Friday at €857.30, a 1.15% daily decline, and now trades 6.72% above its 50-day moving average of €803.32 and more than 109% above its 200-day average of €409.18. The relative strength index of 48.7 has exited overbought territory, suggesting the stock is settling into a neutral zone after its spring surge. The 52-week high of €1,103.80, set on June 25, remains 22.33% above the current price.
Micron at a turning point? This analysis reveals what investors need to know now.
The next major checkpoint arrives on September 29, when Micron reports fourth-quarter results. Investors will be watching whether the company’s pricing power and margin trajectory justify both the $250 billion spending commitment and a market capitalisation that has swelled to roughly €938 billion — a valuation that, for now, continues to split Wall Street between believers and sceptics.
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Micron Stock: New Analysis - 11 July
Fresh Micron information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
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