Micron Maintains Pricing Discipline Amid Supply Chain Uncertainty
Key Summary
Elon Musk backs Micron's pricing restraint as the company faces downward pressure from a Chinese memory manufacturer, ChangXin Memory Technologies. Despite a $150 billion backlog and locked-in demand, investors worry about new supply and its potential impact on the shortage. Musk sees Micron's pricing discipline as a loyalty play that could pay off for the company later, while JPMorgan analysts expect the shortage to last through 2028.
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The article discusses Micron's pricing restraint in the face of a Chinese memory manufacturer's progress on denser DRAM designs.
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This has led to concerns about new supply and its potential impact on the shortage.
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However, JPMorgan analysts see locked-in demand, with 26 long-term customer deals covering over 35% of Micron's revenue through 2030.
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They also count $32 billion of customer cash already committed and over 75% of next year's output already sold.
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Elon Musk backs Micron's pricing restraint, seeing it as a loyalty play that could pay off for the company later.
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Musk buys Micron memory indirectly, as his AI data centers near Memphis run Nvidia chips built with it.
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JPMorgan expects the shortage to last through 2028, and if that holds, Micron's pricing discipline matters most afterward, when buyers can choose again.
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Until then, Micron stock trades between Wall Street price targets near $1,500 and fears of a Chinese supply wave.
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Despite the pressure, Micron stock remains up roughly 223% in 2026.