What comes up must come down? Maybe, but maybe not. Shares of Micron (MU +3.92%) dropped more than 9% over the past week, rattling investors accustomed to Micron shares only going north. The pullback wasn't due to anything Micron said or did, but rather to a mix of uncertainty and fears about AI regulation and the slowing pace of its development.
Micron, along with rivals SK Hynix and Samsung, controls almost 90% of the global DRAM market. The demand for memory is unprecedented; these three companies control the vast majority of supply, and thus have pricing power. While there hasn't been antitrust scrutiny yet, this is another concern in the longer term.
Ultimately, these fears feel a bit more panicky than based on the current reality, though. Micron's memory supply is sold out through 2026 and is nearly sold out for 2027. The company has said it can only meet a portion of customer demand in the medium term. This means that any AI-related slowdown is unlikely to affect Micron until at least 2028, if at all.
Memory chips are in a supercycle, unlike the memory cycles that came before it. It may eventually end if supply can catch up with demand, but until then, this dip looks less like a warning sign and more like a chance to buy the stock at a slightly lower price. The AI infrastructure build-out is still in a very early stage, and Micron has a firm grip on market share.
Shares of Micron are still up more than 225% in 2026 and 485% over the past 12 months. The stock hit an all-time high of $1,255 per share just in June of this year.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.
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