Micron Technology’s stock has plunged 25% over the last month, sliding from an all-time high near $1,255 in late June 2026 to around $920. This drop surprised many, especially since the company recently reported record-breaking revenue and earnings in its fiscal third quarter.
Strong Earnings Clash With Investor Caution
Micron posted $41.46 billion in quarterly revenue, a 346% year-over-year surge, with adjusted EPS at $25.11, far surpassing analyst expectations. Gross margins soared to 85%, and the company forecasted $50 billion in revenue for the next quarter. Despite these stellar figures, investors rapidly sold off shares after locking in gains from a stock that had skyrocketed over 700% in the past year, fueled by high demand for AI-related memory chips.
Market Worries About Supply and Cyclicality
The semiconductors market is wary of the memory industry's cyclical nature. Micron’s recent profits ride on tight supply of HBM, DRAM, and NAND chips critical for AI applications, but memories experience boom and bust cycles. High margins attract competitors and expanded production, which risks oversupply and falling prices. Samsung and SK Hynix's expanding investments add pressure as new capacity is poised to ease shortages. Meanwhile, Chinese firm CXMT challenges Micron’s dominance, with some clients reportedly exploring new suppliers, threatening Micron’s pricing power.
Adding to the pressure, the broader semiconductor and AI hardware sectors have softened amid doubts about future AI infrastructure spending and the profitability of massive data center investments. Developments in custom chips by major tech firms are also unsettling investor enthusiasm.
