Micron rises 19% on AI-driven forecast, fuels chip stock rally
stocks after its strong revenue forecast signaled robust demand for the hardware used to power generative AI technology.
The company, whose high-bandwidth memory chips (HBM) are used in Nvidia's popular artificial intelligence processors, could potentially add more than $19 billion to its market value.
Strong demand for HBM chips has helped Micron offset inventory buildups in other areas such as the personal computer market. PC providers had earlier built up memory chip inventory in anticipation of higher prices, CEO Sanjay Mehrotra said on a post-earnings call on Wednesday.
The company delivered its best quarterly revenue growth in a decade in the fourth quarter ended Aug. 29 and its forecast for the current period came widely above Wall Street estimates.
Micron's earnings and forecast also lifted shares of Nvidia, Intel and Broadcom by more than 2%. Other chip firms, including AMD and Qualcomm and Arm Holdings were up over 3%.
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