Memory Chip Shortage to Last Until 2028: Analysis of Its Impact on Micron Technology's Investment Value

Based on the data and analysis I have compiled, here is a

.

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According to Christopher Moore, Vice President of Marketing for Micron Technology’s Mobile and Client Business Unit, the memory chip shortage stems from multiple factors as follows [1]:

• Long Wafer Fab Expansion Cycle
  : Construction, equipment installation, and customer certification for new wafer fabs typically take 3-5 years
• Process Complexity
  : Differentiated memory module capacity requirements (e.g., Apple requires 8GB, 12GB, and 16GB memory modules simultaneously) lead to frequent production line adjustments and reduced yields
• High HBM Manufacturing Difficulty
  : Producing 1GB of HBM consumes wafer capacity equivalent to 4GB of standard DRAM, further exacerbating capacity constraints
• Capital Expenditure Discipline
  : Memory manufacturers have learned lessons from historical cycles, exercising caution in capacity expansion to avoid oversupply

• AI infrastructure construction consumes massive amounts of NAND flash, DRAM memory, and hard disk drives
• An AI server requires 8 times more DRAM and 3 times more NAND than a standard server
• Large model projects from giants like OpenAI alone consume nearly 40% of the world’s DRAM wafer capacity [2]

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Micron Technology recently released stellar results for Q1 of FY2026 [0]:

Indicator	Actual Value	Market Expectation	Beat Margin
Earnings Per Share (EPS)	$4.78	$3.96	+20.71%
Revenue	$13.64B	$12.91B	+5.70%

Quarter	EPS	Revenue (USD)
Q2 FY2025	$1.56	$8.05B
Q3 FY2025	$1.91	$9.30B
Q4 FY2025	$3.03	$11.31B
Q1 FY2026	$4.78	$13.64B

It is evident that Micron Technology is in a strong earnings growth cycle, with both revenue and profit showing accelerated growth momentum.

Based on the latest data [0]:

Indicator	Value	Industry Position
Market Capitalization	$386.33B	World’s 3rd Largest Memory Chip Manufacturer
P/E (TTM)	32.60x	Reasonably High
P/B	6.60x	Slightly Above Historical Average
ROE	22.43%	Excellent
Net Profit Margin	28.15%	At Historical High
Operating Margin	32.69%	Substantially Improved
Current Ratio	2.46	Financially Sound

Micron Technology’s revenue breakdown is as follows [0]:

Business Unit	Abbreviation	Revenue Share	Key Applications
Compute and Networking Business Unit	CNBU	54.5%	Data Centers, AI Servers
Mobile Business Unit	MBU	16.7%	Smartphones
Storage Business Unit	SBU	15.6%	SSD Storage
Embedded Business Unit	EBU	13.2%	Automotive, Industrial

• The Compute and Networking Business Unit (CNBU) contributes over half of total revenue, benefiting from explosive demand from AI data centers
• The Mobile Business Unit (MBU) faces supply pressures but remains a key revenue source

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According to forecasts from TrendForce and multiple institutions [2][3]:

Time Period	DRAM Price Increase	NAND Price Increase
2025Q4	18-23%	5-10%
2026Q1	~30%	~40%
DDR5 RDIMM	Potential Over 40%	-

Barclays predicts that Micron Technology’s gross margin will reach

in the next quarter, with room for further improvement in subsequent quarters [3].

Micron Technology is accelerating its layout in the High-Bandwidth Memory (HBM) market:

• Management expects the addressable HBM market to grow at a
  CAGR of approximately 40%
  , reaching
  $100 billion
  by 2028
• Micron has achieved a breakthrough in HBM4 technology and is expanding its production capacity

Based on the current supply-demand dynamics, Micron Technology is expected to achieve:

• Substantial revenue growth in FY2026 (analysts’ average forecast of $78.4 billion)
• EBITDA is expected to reach $31.4 billion (average forecast)

Christopher Moore stated candidly [1]:

• As capacity is prioritized for high-margin AI and data center segments, consumer markets such as PCs and smartphones will continue to face supply constraints
• Laptop and smartphone manufacturers may be forced to limit memory configurations or raise product prices
• Micron has exited some consumer businesses (the Crucial brand), which may impact its consumer market share

Supply constraints may lead to:

• Some customers switching to competitors (e.g., SK Hynix, Samsung)
• Being in a passive position in long-term customer contract negotiations
• Risk of market share redistribution

DCF valuation analysis shows [0]:

Scenario	Intrinsic Value	Comparison with Current Price
Conservative	$321.00	-7.0%
Neutral	$254.82	-26.2%
Optimistic	$408.12	+18.3%
Weighted Average	$327.98	-5.0%

, posing a certain pullback risk.

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Based on technical analysis [0]:

Indicator	Value	Signal Interpretation
RSI (14)	Overbought Zone	Short-term correction risk
KDJ	K:88.7, D:87.6	In overbought territory
MACD	Bullish Zone	Mid-term trend upward
Beta	1.5	Higher than market volatility
Support Level	$284.45	Key support level
Resistance Level	$353.29	Recent high

• The stock price is in a range-bound pattern ($284.45-$353.29)
• Short-term overbought correction risk exists
• Mid-term upward trend remains intact

Period	Increase
1 Month	+43.11%
3 Months	+90.03%
6 Months	+177.11%
1 Year	+263.02%
3 Years	+502.57%

Micron Technology has become

.

Indicator	Data
Consensus Rating	BUY (80.6% of analysts recommend buying)
Average Target Price	$325.00
Target Price Range	$190.00 - $443.00
UBS Latest Target Price	$400 (up from $300)
Barclays Rating	Overweight, Target Price $275

• Bulls
  (UBS, Piper Sandler, JP Morgan, etc.): Emphasize the sustainability of the memory super cycle and HBM growth potential
• Cautious Parties
  (Goldman Sachs, etc.): Worried about changes in the pricing environment in 2026 and capacity expansion by competitors such as Samsung

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Manufacturer	Market Share	Competitive Advantages	Disadvantages
SK Hynix	35%	Leading HBM technology, biggest beneficiary of AI demand	Traditional DRAM share under pressure
Samsung	33%	Strongest comprehensive strength, vertical integration	HBM yield issues affecting supply
Micron Technology	23%	Technology follower, cost advantage	Relatively smaller scale
Others	9%	Regional advantages	Technologically lagging

• Achieved a breakthrough in HBM3E technology, certified by NVIDIA
• Focused on 1gamma process penetration and TSV equipment deployment
• Improved cost control capabilities

• HBM production capacity lags behind SK Hynix and Samsung
• Relatively small market share
• Relatively weak bargaining power in the AI chip supply chain

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Highlight	Description
Super Cycle Confirmed	AI-driven structural growth in memory demand, potentially altering the nature of the cycle
Enhanced Pricing Power	Supply constraints give manufacturers stronger pricing power
Profit Margin Expansion	Gross margin is expected to reach a historical high of 68%
HBM Growth Potential	40% annual CAGR, reaching a $100 billion market by 2028

Risk	Description
Overvaluation	Current price is higher than DCF valuation, with a PE ratio of 32.6x
Technical Overbought	Short-term stock price surge is excessive, potential correction ahead
Cyclical Risk	The memory industry has a history of high volatility
Increased Competition	Samsung may seize market share after its HBM gets certified
Consumer Market Atrophy	Potential share loss in PC and smartphone markets

Scenario	Trigger Condition	Expected Return
Optimistic	AI demand continues to exceed expectations, HBM market share increases	+18% ($408)
Neutral	Supply-demand balance develops as expected	-5% ($328)
Pessimistic	Samsung expands capacity, price war resumes	-26% ($255)

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1. Strong Fundamentals
   : Both revenue and profit hit record highs
2. Clear Industry Outlook
   : Memory shortage will last at least until 2028
3. Strong Technicals
   : Mid-term upward trend remains intact

1. The short-term surge is excessive; it is advised to wait for a pullback before adding positions
2. Current valuation has already priced in some positive expectations
3. Need to monitor the impact of Samsung’s HBM capacity expansion in 2026

Strategy	Operational Recommendation
Position Management	It is recommended that the allocation to the memory sector does not exceed 15-20% of total portfolio
Entry Timing	Wait for the stock price to pull back to the $300-$320 range before positioning
Stop-Loss Setting	Trigger stop-loss if the price effectively breaks below $280
Target Price	Primary target $380, mid-term target $430

Time	Event	Impact
2026-03-19	FY2026 Q2 Earnings Release	Performance verification
H2 2026	Samsung’s HBM Capacity Ramp-Up	Supply-demand changes
2027	New Wafer Fab Commences Production	Supply-side changes
2028	Industry supply-demand may balance	Cycle turning point

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If the memory chip shortage persists until 2028, it will be

for Micron Technology and the entire memory industry:

1. Short-Term (2025-2026)
   : Prices will continue to rise, Micron will benefit significantly, with strong certainty in profit margin expansion
2. Mid-Term (2026-2027)
   : Need to monitor capacity expansion by competitors such as Samsung, as the pricing environment may change
3. Long-Term (2028 and Beyond)
   : After new capacity comes online, the supply-demand balance may be broken, and industry cyclical risks will rise

• The memory industry is in an AI-driven structural super cycle
• As the world’s third-largest DRAM manufacturer, Micron Technology will fully benefit from price increases and growth in the HBM market
• Current valuation is high; it is advised to accumulate on dips rather than chase highs

: The memory industry is highly volatile; investors should implement proper position management and risk control.

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[0] Jinling API Data - Real-Time Quotes, Financial Analysis, Technical Analysis, and DCF Valuation Data for Micron Technology (MU)

[1] WCCFTech - “Micron Exclusive: Why Consumers Have Gotten the Memory Shortage Narrative All Wrong” (https://wccftech.com/micron-exclusive-why-consumers-have-gotten-the-memory-shortage-narrative-all-wrong/)

[2] 21st Century Business Herald - “Unprecedented Memory Chip Shortage, A-Share Listed Companies Lock in High Profit Expectations” (https://www.21jingji.com/article/20260106/herald/01c429849bac09d4bdaa4b9e6f93d96f.html)

[3] Securities Times - “Surging! Just Now, a Major Positive Catalyst Hits!” (https://www.stcn.com/article/detail/3547285.html)

[4] Huaan Securities - “AI Inference Ushes in a New Era, Hardware Upgrade Brings New Opportunities – 2026 Annual Strategy for the Electronics Industry” (https://pdf.dfcfw.com/pdf/H3_AP202512161801685417_1.pdf)

[5] Futu News - “Micron: Memory Shortage Will Last Until 2028” (https://news.futunn.com/post/67226669)

[6] NetEase News - “Micron: Memory Shortage Will Last Until 2028” (https://www.163.com/dy/article/KJ2HOEGV0511CPMT.html)

[7] OFweek AI Network - “Memory Sector Surges, How Powerful Is the AI Memory Super Cycle?” (https://m.ofweek.com/ai/2026-01/ART-201700-8420-30678415.html)