Bloomberg

Soaring prices for memory chips have made Micron Technology Inc. one of the standout stocks of 2026, and its earnings after the close on Wednesday will give clues on whether the rally is sustainable.

Micron shares have soared 63% to start the year, among the best performers in the S&P 500 Index, after jumping 239% in 2025. The biggest US maker of memory chips is benefiting from heavy spending on artificial intelligence computing that’s driving demand for memory and storage components, as are high-flying peers Sandisk Corp. and Western Digital Corp.

Most Read from Bloomberg

Investors are optimistic that elevated prices for memory chips will bolster Micron’s quarterly results and forecasts. But there are questions about how long the good times will last and whether Micron can live up to expectations.

“This pricing environment won’t last forever, but all signs are pointing to tight supply this year and sold-out capacity next year, so investors can take some comfort that we’re not close to the peak yet,” said Hendi Susanto, a portfolio manager at Gabelli Funds, which has about $35 billion in assets and holds Micron shares. “Because prices look sustainable in the near term and the stock looks pretty cheap, its hard to see significant downside. The biggest risk is probably high expectations.”

Shares were up 0.8% in midday trading on Wednesday.

While other AI infrastructure stocks like Nvidia Corp. have stalled out amid concerns about the sustainability of spending and peaking revenue growth, memory and storage companies continue to climb. Part of that is due to the higher prices they’re able to command as supply remains constrained. An index of spot prices for the dynamic random access memory chips that Micron makes is up more than 500% since the end of September.

Micron shares closed at a record $461.69 on Tuesday, bringing the company’s market value to about $520 billion, up from $100 billion at the end of 2024.

The Boise, Idaho-based chipmaker is expected to deliver fiscal second-quarter net income of $10.1 billion on revenue of $19.6 billion, according to the average of analyst estimates compiled by Bloomberg. That would represent growth of 540% and 144%, respectively, from a year ago.

The memory industry has long been prone to booms followed by brutal busts. Micron lost money as recently as the first quarter of 2024 amid slumping prices. But the magnitude of the current spending and the deep pockets of the companies behind it is expected to make this cycle bigger and longer lasting. And the difficulty of adding significant production capacity has Wall Street betting that memory prices won’t fall anytime soon.