"Unprecedented shortage of memory! Micron Technology, Inc. (MU.US) warns chip shortage may extend to 2027."

NVIDIA Corporation (NVDA.US) supplier Micron Technology, Inc. (MU.US) said that the ongoing shortage of memory chips has intensified in the past quarter, and reiterated that the tight supply situation will continue into later this year due to the surge in demand for high-end semiconductors needed for artificial intelligence infrastructure. "We are seeing a shortage that is truly unprecedented," said Manish Bhatia, Chief Operating Officer of Micron Technology, Inc., in an interview. Earlier, the chip manufacturer had just held a groundbreaking ceremony for its $100 billion production facility in the suburbs of Syracuse, New York. This statement further strengthens the company's similar prediction made in December. Bhatia pointed out that the high-bandwidth memory (HBM) required for manufacturing artificial intelligence accelerators is "consuming a significant amount of available capacity in the entire industry, leading to a significant shortage in traditional industries such as smartphones or personal computers (PCs)." He added that PC and smartphone manufacturers have joined the queue, trying to secure memory chip supply after 2026, while autonomous driving cars and humanoid robots like Siasun Robot & Automation will further increase demand for these components. Last Friday, Chinese media reported that major Chinese smartphone manufacturers, including Xiaomi Group, Oppo, and Shenzhen Transsion Holdings Co., Ltd., are cutting their shipment targets for 2026 due to rising memory costs. Industry tracking firm Counterpoint Research estimated in December that global smartphone shipments may decline by 2.1% this year due to the shortage of memory chips pushing up costs and squeezing production. PC manufacturers, including Dell Technologies, Inc. Class C, also warned that they may be affected by the ongoing shortage. Thanks to the artificial intelligence boom, the stock prices of the three giants in the global memory chip industry - Micron, SK Hynix, and Samsung Electronics - have surged significantly in 2025. SK Hynix stated that its entire chip capacity for 2026 has been sold out, while Micron also indicated that its AI memory semiconductor for this year has been fully booked. Artificial intelligence boosts the performance of the three giants in the memory industry To prioritize supplying strategic enterprise clients, including NVIDIA Corporation, Micron announced in December that it would terminate its popular Crucial brand consumer memory business. The almost "greedy" demand for memory chips in the artificial intelligence industry has also increased the urgency for Micron to expand production in the United States and Asia. Last Saturday, Micron announced plans to invest $1.8 billion to purchase a site in Taiwan containing existing factories, which is a key production hub for the chip manufacturer. This move significantly shortens the time for Micron to start producing in new factories. The company stated that substantial DRAM wafers will begin production in the second half of 2027. DRAM provides the operating environment for sophisticated processors in NVIDIA Corporation and Intel Corporation's calculations and is crucial for the high-bandwidth memory required for optimized operation of AI accelerators. Bhatia stated in the interview, "What we need to do at our Asian base is continue the transition to next-generation technology." He added that the additional wafer capacity will be almost entirely achieved in the United States. Micron's $100 billion project near Syracuse plans to build four DRAM wafer plants, each the size of about 10 football fields. The first wafers are expected to be online by 2030. The US chip manufacturer is also increasing capacity with two wafer plants next to its existing research facility in Boise. The first wafer plant in Idaho is scheduled to start production in 2027, with the second plant in the planning stage. In addition, the company is modernizing and expanding its existing manufacturing facilities in Virginia. These plans are part of the company's commitment to move 40% of its DRAM manufacturing to the United States. The realization of this goal is supported by the $6.2 billion "Chip Act" funding the company received in 2024, as well as the currently increased tax incentives to 35% that can be utilized during construction.