Micron Technology NASDAQ:MU, a U.S. memory-chip maker, is seeing a sharp profit surge as artificial intelligence data centers absorb growing supplies of DRAM and high-bandwidth memory. Alongside SK Hynix (HXSCL), a South Korean memory-chip producer, and Samsung Electronics (SSNLF), a South Korean technology company with a major memory business, Micron is benefiting from a supply crunch that has pushed memory prices sharply higher. The three companies control about 90% of the DRAM market and effectively all HBM supply, giving them significant pricing power as shortages are expected to persist until around 2028.
Bloomberg-cited analyst estimates suggest Micron's fiscal 2026 net profit could reach about $83 billion, exceeding the company's combined profits over the past three and a half decades. Its operating margin has also reached about 80%, among the highest levels for large technology companies. Micron's average DRAM prices were nearly four times higher in the March-to-May quarter than a year earlier, while the three major memory producers are expected to generate $1.4 trillion of free cash flow over the next three years if analyst forecasts prove correct.
The investment case may look powerful, but the risks are also building. Apple, the U.S. consumer-electronics company behind the iPhone, has blamed memory costs for roughly 20% price increases on iPads and Macs, while GoPro, an action-camera maker, has warned about its ability to continue as a going concern after memory costs surged. SK Hynix has warned investors about possible government inquiries, litigation, regulatory scrutiny and policy actions, while Micron has flagged risks tied to strained customer relationships, downstream disruption and increased government focus.