
Company Background
Founded in 1978 and headquartered in Idaho, USA, Micron designs, develops and
manufactures high-end memory and storage products. Most of Micron’s revenue comes
from DRAM sales (78% of FY25 revenue), and almost all remaining revenue is from NAND
sales (21%). Micron has 13 manufacturing sites globally. Micron’s revenue is largely from
the US (65% of FY25 revenue) and Taiwan (15%).
Investment Highlights
▪ Micron’s HBM4 is expected to ramp in CY2Q26e. Micron is keeping up very closely to
the HBM market leader SK Hynix (~60% market share). Its HBM3E chips are designed
into Nvidia’s Blackwell and AMD’s MI355 GPU, driving its 45% revenue growth in CY25,
closely behind SK Hynix 47% YoY revenue growth. Micron has a strong product cadence
in 2026, with its next-generation HBM4 expected to ramp in CY2Q26e. Micron has a
HBM4 per-pin speed of over 11 gigabits per second (Gbps), higher than SK Hynix’s
estimated 10 Gbps. We believe Micron can chip away SK Hynix’s HBM market share
when its HBM4 product ramps beyond CY2Q26e.
▪ Severe shortage in memory chips. DRAM prices have been increasing for eight
consecutive quarters to the highest levels since 2019, due to industry shortage. Memory
customers are still increasing their capex guidance for AI infrastructure buildout in 2026.
Both Micron and SK Hynix mentioned that their HBM products are sold out for 2026.
Micron and SK Hynix’s combined capex-to-sales ratio rose 6ppt YoY to 34% in 4Q25.
However, we expect the supply gap to persist and capex-to-sales ratio to decline in 2026
as Micron’s capex intensity falls ahead of Idaho fab construction in 2027, while SK Hynix
guided it will maintain at mid-30s levels.
▪ Strong presence in the US positions Micron for further grants and benefits. From 2024
2025, Micron entered into separate funding arrangements with the US Department of
Commerce for a total of US$6.4bn in direct funding (~8% of total assets) for three
planned fabs in the US. Under the CHIPS Act, Micron also received a 35% investment tax
credit on qualified investments in US semiconductor manufacturing. We estimate
Micron can benefit from over US$50bn in tax savings over 5-6 years as its US fabs are
being built.
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Passionate in looking for new ways to use data to tell a story, I enjoy chatting about economics and connecting complex financial data to real-world outcomes. I look forward to conducting quality fundamental research and exchanging insights with you during our in-house seminars and presentations. I graduated from the National University of Singapore with a Bachelor of Engineering (Industrial and Systems Engineering), Honours.