Shares of Micron Technology plummeted by 18.1% in March after a groundbreaking artificial intelligence (AI) breakthrough made its memory chips less essential. Despite this, the semiconductor specialist reported impressive results for its fiscal 2026 second quarter, with revenue soaring 196% year over year to $23.9 billion. CEO Sanjay Mehrotra attributed the success to strong demand for AI processing and a shortage of memory chips.
However, Google’s recent announcement of an advanced compression algorithm could reduce the need for Micron’s memory chips by at least 6x, potentially decreasing demand in the short term. The jury is still out on whether this will lead to increased adoption of AI, which would drive long-term demand for Micron’s products. Investors should resist knee-jerk reactions and wait for more information before making decisions.
Key points:
– Micron Technology reported a 196% year-over-year revenue surge.
– CEO Sanjay Mehrotra attributed the success to strong demand for AI processing.
– Google’s new compression algorithm could reduce memory chip demand by at least 6x.
Source: https://www.fool.com/investing/2026/04/03/why-micron-stock-slumped-18-in-march