25.06.2026 - Micron keeps AI dreams alive
The AI rally received a fresh boost after Micron Technology delivered another blockbuster quarter, reigniting investor enthusiasm across the semiconductor sector.
Micron reported second-quarter revenue that was four times higher than a year ago and issued a sales forecast that comfortably exceeded Wall Street expectations. The company also beat estimates across virtually every key financial metric, including revenue, earnings per share and adjusted gross margin.
One figure stood out in particular. Micron reported a gross margin of 84.9%, up from 74.9% in the previous quarter and just 39% a year earlier. That now exceeds the gross margins of every major US technology company, surpassing Meta's 81.9% and Nvidia's 75%. The AI infrastructure boom continues to fuel unprecedented demand for high-bandwidth memory (HBM), allowing Micron to achieve record profitability almost as quickly as customers can secure its chips.
Investors rewarded the results immediately. Micron shares surged as much as 15% in after-hours trading, lifting sentiment across global equity markets. Nasdaq 100 futures climbed around 2%, while South Korea's Kospi jumped nearly 7% as investors rushed back into AI-related stocks.
Markets:
Equities: AI-related semiconductor stocks rallied, led by Micron. Nasdaq 100 futures gained around 2%, while Asian technology shares posted strong gains.
My View: The latest results reinforce one message: demand for AI infrastructure remains exceptionally strong. Memory chips have become one of the most critical components powering the AI revolution, with hyperscalers and technology companies continuing to invest aggressively in new data centres.
Readers of my comments on ETFMandate know that I have been, and remain, skeptical of the current AI boom.
However, for the time being, AI has become the new gold. Every major technology company is racing to build AI infrastructure, and demand for advanced memory chips continues to outpace supply. Fear of missing out the race dominates and intensifies the process. AI companies are buying virtually every chip they can get, creating persistent shortages and giving manufacturers such as Micron significant pricing power. The explosive improvement in gross margins clearly illustrates how favourable the current market environment has become for leading chip producers.
Micron's exceptional earnings have once again reset expectations for the AI memory trade and may have given the broader AI rally a fresh lease on life.
The key question now is whether this is merely another short-covering bounce or the beginning of a new leg higher for technology stocks. Momentum could return even we are already at lofty, dream-driven valuation levels.
I remain skeptical. The AI investment boom is real, but so is the risk of excessive optimism. History shows that markets often overshoot, especially when capital flows become concentrated in a handful of high-growth names. The semiconductor sector remains one of the most crowded trades in global equity markets, leaving little room for disappointment.
For investors who have enjoyed the extraordinary rally in chip stocks, Micron's outstanding earnings may provide an attractive opportunity to take some profits and reduce exposure.
Despite Micron's impressive results, my view remains that downside risk and potential bigger correction is much higher than upside potential on the sector and AI names, therefore, continue to position my portfolio accordingly.
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