Sanjay Mehrotra found himself in an unusual setting last week: the Zhongnanhai compound in Beijing, seated alongside Apple, Tesla and Nvidia executives as part of President Trump’s business delegation meeting China’s Xi Jinping. For the Micron chief, the stakes extended well beyond diplomatic photo-ops. China generates roughly $3.4 billion in revenue for the memory maker — about 12 percent of total sales — and any breakthrough on market access would be a game-changer for a company already riding the AI memory wave. The summit yielded a fragile détente and an agreement to create a “Board of Trade,” though Xi warned that mishandling the Taiwan issue could lead to “confrontation.” That tension encapsulates Micron’s delicate balancing act: it benefits from the US CHIPS Act while remaining deeply embedded in a market caught in the crossfire of the US-China chip war.
The geopolitical drama unfolds as Micron pours capital into an expansion cycle unlike any in its history. Capital expenditure for fiscal 2026 is pegged at more than $25 billion, with the vast majority flowing into AI infrastructure. A new plant in Hiroshima will break ground this month and begin supplying HBM chips from 2028, backed by roughly 536 billion yen in Japanese government subsidies. In Taiwan, Micron has taken over Powerchip Semiconductor’s P5 site in Tongluo, converting its 300,000-square-foot cleanroom since March, with a second facility of similar scale due to start before the end of the fiscal year. The company is also sampling new 256-gigabyte DDR5 server modules built on its proprietary 1-gamma DRAM technology, aimed squarely at data centers and AI inference workloads. Critically, Micron has already locked in pricing and volume agreements for its entire HBM output in fiscal 2026 — a sign that demand is running well ahead of supply for both DRAM and NAND.
That demand surge has propelled the stock to staggering heights. Market capitalisation recently touched $906 billion, leaving the trillion-dollar mark within striking distance after a year-to-date gain of roughly 150 percent. Yet the rally has not been without its speed bumps. Director Steven J. Gomo sold 2,000 shares on May 11 at an average $787.03, pocketing about $1.57 million. He joined a broader insider sell-off that has reached $52.4 million in aggregate. Ross Gerber, co-founder of Gerber Kawasaki, also disclosed sales of Micron alongside Nvidia and Broadcom on May 14, though he attributed the move to a 25 percent sector weighting limit imposed by the fund rather than any change in conviction. Separately, the stock gave up 1.47 percent on May 14 after hotter-than-expected inflation data triggered profit-taking across the market, closing at $791.84. The technical picture confirms the strain: the relative strength index sits at 77, firmly in overbought territory.
Should investors sell immediately? Or is it worth buying Micron?
Analysts remain sharply divided on where Micron goes from here. Bank of America lifted its price target to $950, arguing that the AI data-center market could reach $1.7 trillion by 2030. On the other side, 24/7 Wall St. set a target of just $435.15, warning of cyclical headwinds and the insider selling activity. CEO Mehrotra himself conducted 25 transactions on May 1, selling shares in a range of $511 to $545. Those moves do not necessarily signal a loss of faith — executives often sell for tax or estate planning — but they provide ammunition for bears. The bull case, however, is backed by extraordinary financials. Fiscal second-quarter revenue hit $23.86 billion, nearly triple the year-ago figure and representing 196 percent growth. Adjusted earnings per share came in at $12.20. For the third quarter, management guided for revenue around $33.56 billion and adjusted EPS of $18.97, numbers that underscore the scale of the AI-driven demand spike.
Remarkably, Micron also raised its dividend by 30 percent — a signal that the board expects ample free cash flow even amid the heavy investment cycle. The move suggests confidence that the current capital spending will generate enough return to cover both expansion and shareholder payouts. That conviction will face its next public test on June 24, when the company reports fiscal third-quarter results. The market will be watching whether the AI order momentum can sustain the elevated guidance and whether China — still subject to unpredictable trade policy — remains a stable source of revenue. For now, the combination of a CEO shuttling between Washington and Beijing, a fully booked HBM pipeline through 2026, and a stock flirting with a trillion-dollar valuation makes Micron one of the most tightly wound narratives in the semiconductor space.
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