The AI data center building boom isn’t fueling just water shortage concerns and GPU-maker Nvidia’s coffers. It is now also firmly making memory chip makers and their investors significantly richer.
Yesterday, two of the largest memory makers, Micron Technology and Sandisk, saw their stock prices soar more than 11% in a single trading session.
And those gains are small potatoes compared to their five-day increases. But why is this happening? Here’s what you need to know.
What’s happened?
Yesterday, all four of the Nasdaq’s major memory chip makers saw their stock prices jump. Those four memory makers include:
- Micron Technology, Inc. (Nasdaq: MU)
- Sandisk Corporation (Nasdaq: SNDK)
- Western Digital Corporation (Nasdaq: WDC)
- Seagate Technology Holdings (Nasdaq: STX)
While there is some overlap, the first two on that list, Micron and Sandisk, focus on short-term memory chips (known as RAM), while Western Digital and Seagate specialize in long-term memory, known as SSDs.
It’s the short-term memory chip makers, Micron and Sandisk, that saw their stock prices surge the most yesterday—up more than 11%.
And both are currently up more than another 5% as of the time of this writing in premarket trading this morning. Western Digital and Seagate rose 5.1% and 4.3% yesterday, respectively, and are up just under 3% today.
And looking back slightly longer, over the past five trading sessions, the gains that those memory chip makers have seen are even more stark.
As of yesterday’s market close, during the past five trading sessions, Sandisk is up 40%, Micron is up nearly 27%, Seagate is up 33%, and Western Digital is up 19%.
That is an astounding jump over such a short time. But the question is, why have these stocks risen so much now?
Memory chips become the AI data center bottleneck
When the AI boom kicked off in 2023, the most critical component in data center buildouts that companies threw themselves into was the GPU.
These graphics processing units were critical components of the servers on which artificial intelligence’s large language models (LLMs) ran. The demand for GPUs made Nvidia the most valuable public company ever.
While there is still massive demand for GPUs, in 2025 and early 2026, the AI data center bottleneck shifted from GPUs to memory chips. While GPUs process the AI tasks, memory chips are needed to store the outputs. Without them, AI is useless.
The resulting memory chip shortage that has engulfed the industry has sent the share prices of memory chip companies soaring as demand for their products has gone through the roof.
But in the past week or so, specifically, there have been several announcements that have given memory chip makers’ stock prices—particularly Micron and Sandisk—a major boost.
The first was Sandisk’s Q3 2026 earnings results, which the company announced on April 30.
Those results revealed that quarterly revenue surged 97% to $5.95 billion. And the company is expecting Q4 revenue to reach between $7.75 billion to $8.25 billion. Its surge in profits was even better: up 286%.
These results led several investment firms to raise their price targets for the company—notably Bernstein, which increased its SNDK outlook from $1,250 to $1,700 per share (per TipRanks).
Investors were also buoyed by Micron’s announcement yesterday that it had begun shipping the “world’s highest capacity commercially available SSD,” the Micron 6600 ION SSD, with a capacity of 245TB.
This SDD is designed to provide the storage and speed that servers in AI data centers need, while also being up to 84 times more energy efficient than traditional storage methods.
AI companies are acutely aware of the massive energy consumption that data centers need, leading investors to believe that Micron’s latest SSD will likely have widespread appeal in the industry.
These recent bits of news seem to have spurred investors to pour money into the stocks of these companies over the past several days.
The memory shortage rally
While the memory shortage is frustrating for AI hyperscalers and costly for any consumer planning to buy a laptop or smartphone this year, it has been great for the stock prices of the four most prominent memory companies on the Nasdaq.
As of yesterday’s market close, Sandisk’s stock price reached $1,406, up over 492% year to date. Micron stock reached $640, up 124% YTD. Western Digital reached $465, up 179% YTD. And Seagate reached $771, up almost 180% YTD.
But looking back even father reveals just how good the AI boom and resulting memory chip shortages have been for the four companies. Over the past 12 months, these are the stock price gains:
- Sandisk: up 3,963%
- Western Digital: up 933%
- Seagate: up 723%
- Micron: up 696%
Given that memory chip demand shows no signs of slowing, many investors clearly believe that the stock prices of these companies can continue to benefit for quite some time.
