TLDR
- Micron rose 3.5% and SK Hynix ADRs jumped 6.7% in premarket trading Thursday
- Alphabet raised its 2026 capex forecast to $195B–$205B, up from $180B–$190B
- Both memory makers are key suppliers of HBM chips used in AI data centers
- SK Hynix has hit the 2.5% ADR conversion limit, restricting U.S. supply of its stock
- Elon Musk publicly thanked Micron during Tesla’s earnings call for securing memory chip allocations
Alphabet reported earnings Wednesday after the bell, and memory chip makers woke up in a good mood Thursday.
Micron (MU) gained 3.5% in premarket trading. SK Hynix ADRs (SKHY) climbed 6.7%. Both moves came directly after Google’s parent company raised its 2026 capital expenditure forecast to between $195 billion and $205 billion — up from its prior guidance of $180 billion to $190 billion.
That’s a lot more money flowing toward data centers, and that means more demand for the chips Micron and SK Hynix make.
CFO Anat Ashkenazi said the higher spending reflects faster-than-expected delivery of capacity to meet customer demand. In short: Google is building out faster, and it needs more hardware to do it.
AI servers rely heavily on high-bandwidth memory, or HBM. As Alphabet expands its infrastructure, both Micron and SK Hynix stand to benefit as two of the main HBM suppliers in the market.
The rally is particularly welcome given recent pressure on both stocks. Micron is down roughly 9% over the past month. SK Hynix’s Seoul-listed shares have dropped nearly 25% over the same stretch, as investors worried that sky-high chip prices might not hold and that Big Tech spending could slow.
Wednesday’s numbers from Alphabet did a lot to ease those concerns, at least for now.
SK Hynix Faces Its Own Supply Dynamic
SK Hynix only debuted on U.S. markets on July 10, and it’s already run into an unusual constraint. The stock has hit the 2.5% limit for converting Korean-listed shares into U.S.-traded ADRs. That means no new supply is coming into the U.S. market for the time being.
When buying pressure stays strong and available supply is capped, prices tend to move faster. That’s partly why SK Hynix’s 6.7% premarket move outpaced Micron’s.
The company is also investing heavily on the production side. Its board recently approved a ₩7.09 trillion investment in an advanced packaging facility in Cheongju. SK Hynix is due to report Q2 results on July 29.
Musk Puts Micron in the Spotlight
Micron got a separate boost from an unlikely source. During Tesla’s earnings call, Elon Musk thanked Micron by name for providing Tesla with a meaningful allocation of memory chips on reasonable terms — calling overall memory market pricing “insane.”
The comment was a window into just how tight supply has become across the industry. Customers are scrambling to lock in chips, and Micron is positioned to benefit from both the volume and the pricing environment as it ramps its next generation of memory products.
TipRanks data shows Micron carries a Strong Buy consensus rating, with 29 Buy ratings and one Hold from analysts over the past three months. The average price target sits at $1,569.29, implying roughly 64% upside from current levels.
Stop guessing and start investing with confidence. KnockoutStocks gives you the AI insights, market intelligence, and stock research you need to spot opportunities, cut through the noise, and make smarter investment decisions — all in one powerful platform.
Sign up today and get 50% OFF full access to our premium stock picks.
Simply use coupon code SPECIAL50 at checkout to claim your exclusive discount.
Be the first to comment