Prime Highlights
- Micron’s stronger-than-expected earnings forecast fueled a broad rally in semiconductor stocks, adding more than $400 billion in market value.
- Qualcomm expects its data center business to generate $15 billion in sales by 2029 as it expands its AI strategy beyond smartphone chips.
Key Facts
- Micron Technology is a leading memory-chip manufacturer that supplies products used in AI servers, data centers and computing systems.
- The PHLX Semiconductor Index, a key benchmark for chip stocks, remains up about 90% in 2026 despite recent market concerns over AI valuations.
Background
Shares of major semiconductor companies jumped in after-hours trading, adding more than $400 billion in market value after Micron Technology and Qualcomm released strong forecasts tied to growing demand for artificial intelligence (AI) infrastructure.
Micron led the rally after projecting quarterly earnings above market expectations. The company said increasing investments in AI-focused data centers and infrastructure are expected to boost demand for its memory chips. The upbeat outlook reassured investors who had recently become concerned about the pace of returns from large AI-related spending.
Qualcomm also strengthened market sentiment by forecasting $15 billion in revenue from its data center business by 2029. The company is expanding beyond its traditional smartphone chip business and is increasing its focus on AI-driven opportunities.
The positive updates lifted several semiconductor and storage-related companies. Western Digital, Sandisk and Seagate Technology each gained more than 8% in extended trading. Arm Holdings rose about 6%, while Marvell Technology and Broadcom also posted notable gains.
Companies that supply chip manufacturing equipment also benefited. Applied Materials and ASML both advanced more than 4% as investors anticipated continued spending across the semiconductor industry.
The rally came after a period of weakness in AI-linked stocks. Investors had questioned whether valuations had become too high following years of strong gains and whether heavy spending on AI data centers would generate profits quickly enough. All these worries had been troubling the semiconductor industry lately.
Despite the volatility, semiconductor stocks continue to do well. The Philadelphia Semiconductor Index is up around 90% so far this year, and Micron’s stock price has gained more than 260%.