The potential of Micron, which is attracting attention due to AI demand and revenue growth.

Micron Technology Inc. is one of the few memory chip makers benefiting from the AI boom. Its high-bandwidth memory (HBM) chips are supplied for Nvidia's AI processors, with contracts secured until 2025.
Furthermore, positive expectations are anticipated for the next earnings announcement due to the demand for data centers and improvements in inventory management. Although the stock price is currently below the all-time high, significant upside is expected with profit expansion and guidance. The profit outlook for 2025 is also attracting attention as an indicator of the overall industry trend. The undervalued stock of the company is now under scrutiny as a potential growth driver.

Micron Technology Inc. is clearly improving its performance on the back of increasing demand driven by the rapid growth of the AI market. Its main products, DRAM and NAND, are showing solid growth primarily in demand for data centers and AI processors. In particular, the high-bandwidth memory (HBM) used in Nvidia's processors is already contracted until 2025, serving as a stable source of revenue.
In its strategic segments, Micron continues its 4-year consecutive growth in revenue from automobile products, forming a stable revenue base. Furthermore, as indicated by a 93% increase in revenue in the fourth quarter, Micron has achieved an improvement in gross profit margin through optimization of its product portfolio and price enhancement. These strategies can be seen as efforts to overcome the cyclical nature of the semiconductor market.
However, the current stock price remaining more than 30% below its all-time high reflects investor caution. In the ongoing industry uncertainty, Micron's proactive market strategies are under scrutiny on how they will address this challenge.

The advancement of AI technology has brought long-term growth in demand for the entire semiconductor industry, a particularly favorable trend for Micron. The company has publicly announced a forecast that the demand for DRAM, essential for AI devices, will increase by 30%, which could be a significant factor in revenue expansion. Furthermore, CEO Sanjay Mehrotra has emphasized the continued strong demand from data center customers and is working on strengthening the supply chain to benefit from the AI market.
However, it is important to note whether such growth will continue steadily. As the dependence on the AI sector increases, the demand for traditional markets such as PCs and smartphones is declining, and the intensifying competition in the industry is also a significant factor not to be overlooked. Micron holds $9.2 billion in cash and investments, and leveraging this for research and development as well as expanding production capacity is believed to be crucial.
From a unique perspective, while the growth of the AI market is expected to lift the overall industry demand, it will also be a critical turning point for Micron to sustainably maintain growth in the highly competitive environment.

Micron shares are currently undervalued, trading at 8 times expected earnings, with a forecasted profit per share of $12.58 by fiscal year 2026. This outlook is supported by strong cash flow generation and shareholder return policies. In the fiscal fourth quarter of 2024, the company generated $3.4 billion in operating cash flow and aims to enhance shareholder value by allocating some of it to share buybacks.
Furthermore, out of 29 analysts, 25 rate it as a 'strong buy', with a target price suggesting a potential increase of about 40% from the current level. Such ratings are not only based on short-term market trends but are also backed by long-term growth prospects.
However, considering the inherent volatility of the semiconductor industry, investors should maintain a cautious approach. Risks influenced by market demand cycles and competitive environments still persist, but companies with stable revenue foundations like Micron are likely to stand relatively strong amid such fluctuations.