Micron Technology Inc. (NASDAQ:MU) CEO Sanjay Mehrotra said memory supply shows no sign of catching up with artificial intelligence-driven demand, citing long-term customer agreements locking in years of committed supply as evidence that the current boom is structural, not cyclical.
‘We See No End’
“We see no end when supply catches up with demand, and the demand continues to grow,” Mehrotra told CNBC‘s Jim Cramer on Friday.
He said Micron’s five-year customer agreements, which can be extended, give the company “assurance of demand,” even as “nothing ever goes in a straight line.”
“Today there is no AI without memory,” Mehrotra said, adding that AI systems increasingly require higher-performance, lower-power memory that will eventually extend demand beyond data centers into autonomous vehicles, robotics and AI-enabled consumer devices.
A Structural Shift
Daniel Newman, CEO of The Futurum Group, said on X that Mehrotra “finally said the quiet part out loud,” adding the AI-driven demand cycle “may never end” as data center buildouts give way to robotics, autonomy and physical AI.
Yorkville Ives Senior Managing Director Dan Ives told CNBC the memory trade has become “foundational, not cyclical,” estimating demand-to-supply ratios in AI memory at roughly 15-to-1.
“Memory players, right now it’s their world and everyone else is paying rent,” Ives added.
On Thursday, Micron disclosed the launch of Micron Research Labs, a $10 billion, 10-year investment in a U.S.-based research hub anchored by a flagship campus in Boise, aimed at advancing memory and AI technologies.
Not Everyone Agrees Memory Demand Is Permanent
ARK Invest founder Cathie Wood has taken the opposite view, avoiding memory suppliers like Micron and SK Hynix Inc. (NASDAQ:SKHY) as today’s extraordinary pricing is more likely to invite competition and engineering workarounds than persist indefinitely.
Supply Relief Could Be Years Away
Even as Samsung Electronics Co., Ltd., SK Hynix and Micron all expand capacity, meaningful production relief is unlikely before 2028 at the earliest, according to Counterpoint Research Director MS Hwang, since AI demand is now pulling in conventional DRAM alongside high-bandwidth memory.
Mehrotra made a similar point in June, telling investors on Micron’s fiscal third-quarter earnings call that “even as we expect industry supply to improve gradually in 2028, we currently do not have line of sight as to when memory supply will be able to catch up with increasing demand.”
Price Action: On Friday, shares closed 0.77% lower at $966.78 and fell 0.37% further in extended trading.
Benzinga edge rankings indicate Micron’s stock has a Momentum score in the 99th percentile and a Growth score in the 92nd percentile.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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