Investor Ross Gerber says the artificial intelligence-driven memory shortage powering Micron Technology Inc. (NASDAQ:MU) could last as long as a decade, arguing investors still underestimate how much demand lies ahead.
“Memory is going to be one of the constraining things I think for possibly like a decade,” Gerber said Thursday on Yahoo Finance’s Market Hang. “I don’t think the market gets the story.”
Gerber pointed to Micron trading at roughly six times forward earnings despite its huge run. He expects the company to put more capital toward repurchasing shares as restrictions tied to the CHIPS Act ease in December.
“You know that the supply of stock is going to go down and the demand for the stock is not going to go down,” Gerber said, calling Micron “a gift” for investors.
Why the Memory Crunch Could Last
The bigger question is how long Micron’s extraordinary earnings can continue.
Yorkville America CEO Steve Neamtz told Benzinga that new factories capable of materially easing the shortage may not reach full production until 2028 or 2029.
High-bandwidth memory, or HBM, the type used alongside AI processors, requires roughly three times as much manufacturing capacity per gigabyte as conventional memory, Neamtz said.
But demand is already spreading beyond HBM. Micron’s NAND flash revenue surged 526% year over year to $14.1 billion last quarter as AI data centers required more storage.
Intel CEO Lip-Bu Tan has warned memory shortages could worsen in 2027. Micron CEO Sanjay Mehrotra says the company has no “line of sight” on when supply catches demand, with more than 75% of its 2027 output already committed.
Gerber sees robotics as the next leg of the demand story.
“Robotics will just be coming online in the next decade,” he said. “Can you build a robot without a brain with memory? No.”
What Could Break the Bull Case?
Martin Shkreli, who recently disclosed a short position in Micron, put the risk simply: “If prices drop, it’s all over.”
China’s CXMT is preparing to enter NAND after gaining ground in DRAM, the working memory used by computers and servers, potentially adding another source of supply.
Gerber does expect component prices to fall as new capacity arrives. His bet is that total demand keeps growing anyway.
Prediction Traders See More AI Runway
Later in the discussion, Gerber said he does not believe AI is in a bubble yet.
Polymarket traders put just a 7% chance on an AI-industry downturn by Dec. 31, with about $2.4 million traded on that contract.
Micron shares traded about 1% lower at $1,060 Monday morning.
Image: Shutterstock
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