SK Hynix Has a Major Warning for Micron Technology Stock Investors
The Korean memory giant is planning to significantly increase its production capacity over the next five years.
SK Hynix Has a Major Warning for Micron Technology Stock Investors
Overview
Memory chips have been in phenomenal demand over the past three years due to their deployment in artificial intelligence (AI) data center accelerators, such as graphics cards and application-specific integrated circuits (ASICs). Memory demand has been so strong that there isn't enough supply available to fulfill it.
The supply shortage has led to a sharp spike in memory prices, and Micron Technology (NASDAQ: MU) has been one of the biggest beneficiaries of the favorable demand-supply dynamic in this industry. Micron stock has jumped by 1,570% over the past three years, fueled by phenomenal growth in revenue and earnings.
Details
The good news for Micron investors is that the memory shortage is expected to persist through 2030, according to the chairman of memory giant SK Hynix's parent company. This could set the stage for further growth in Micron's revenue and earnings. However, SK Hynix's latest announcement of rapidly increasing production capacity may undermine Micron's momentum.
Source
Originally published at www.fool.com.
