Micron's stock surges on multibillion-dollar U.S. manufacturing push

By Christine Ji

The memory-chip giant is reversing its recent slide after increasing its investment in the U.S. semiconductor supply chain

Micron's new 10-year agreement with GlobalWafers provides the company with long-term access to advanced 300mm raw silicon wafers.

After a steep post-earnings slide, shares of Micron popped 7% on Thursday morning as the company announced a $3 billion plan to invest in its U.S. semiconductor supply chain.

As part of the plan, Micron (MU) pledged $500 million in strategic financing to GlobalWafers (TW:6488) to help the semiconductor company build out its advanced 300mm raw silicon wafer facility in Sherman, Texas. Micron and GlobalWafers also entered into a 10-year supply agreement, giving Micron guaranteed long-term access to advanced wafer capacity needed to produce high-bandwidth memory and DRAM. Both of these memory components have become increasingly critical to powering artificial-intelligence workloads, causing demand for them to far exceed supply.

"These efforts help build a more resilient supply chain that can support future innovation and growing demand for advanced memory solutions," Ben Tessone, senior vice president and chief procurement officer at Micron, said in a press release.

In addition to the long-term agreement and investment, Micron and GlobalWafers plan to explore "next-generation wafer technologies and process innovations to support future semiconductor manufacturing requirements," Micron said.

Thursday's stock surge brings Micron shares back above the $1,000 threshold, with the stock hovering around $1,200. Prior to that, Micron shares had been caught up in a broader tech selloff as the market corrected from previously overheated investor enthusiasm. Investors have also been debating whether memory-chip makers can escape their historic boom-bust cycles as AI demand skyrockets.

Micron also announced Thursday that it would accelerate its U.S. investments and increase its expected spending to over $250 billion through 2035, up from previous projections of $200 billion. The company reiterated its goal of producing 40% of its DRAM in the U.S.

Thursday also marked Micron's first concrete pour for its facility in Clay, N.Y., a quarter ahead of schedule.

Micron's increased focus on long-term agreements and strategic customer agreements is likely to bring increased visibility and durability to revenues, Evercore ISI analyst Amit Daryanani wrote in a Wednesday note.

The announcement provided investors with further reassurance of Micron's long-term business stability and addressed key geopolitical risks. GlobalWafers is currently the only vendor approved by the CHIPS for America Program that is capable of fabricating advanced 300mm wafers on U.S. soil. Several White House officials, including Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer, expressed their support for the deal as a way to enhance America's supply-chain resilience.

-Christine Ji

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07-09-26 1213ET