Micron Technology shares climbed 2.85% on Monday, recovering part of last week's 11% decline as semiconductor stocks rebounded from a broad selloff tied to AI spending concerns. The Nasdaq Composite rose 1.17%, while Nvidia, Advanced Micro Devices, Intel and SanDisk also advanced.
The rebound followed an eight-session semiconductor decline. Micron stock had fallen from a year-to-date high of $1,253 in June to $878 today, entering a technical bear market. Investor concerns included the financial progress of private AI companies OpenAI and Anthropic, and rising inflation that could push the Federal Reserve to raise interest rates more aggressively, raising financing costs for data centre investment.
Brian Mulberry, chief market strategist at Zacks Investment Management, said the sector's recovery reflected confidence in AI spending and companies' ability to monetise AI offerings. Luke Rahbari, chief executive of Equity Armor Investments, said the selloff showed initial enthusiasm surrounding AI stocks might be fading as investors scrutinise valuations more closely.
Micron also received attention after China's ChangXin Memory Technologies (CXMT) forecast revenue of 265 billion yuan to 270 billion yuan for the first nine months of 2026, compared with 32 billion yuan a year earlier. That forecast signalled strong demand in the memory-chip market but renewed questions about competition.
Despite the bear market, Micron's fundamentals remain strong. The company reported more than $54 billion in fourth-quarter revenue, driven by DRAM, and expects first-quarter revenue above $60 billion. Yahoo Finance data shows the average estimate is $61.7 billion, up 352% year over year. Full-year revenue is expected to reach $275 billion, followed by $318 billion next year. Gross margin jumped to 86.8% last quarter.
Micron also plans to expand buybacks. It repurchased $2 billion in stock last quarter, and after CHIPS Act restrictions end in December, the company has signalled repurchases worth more than $35.6 billion. With $73 billion in cash and short-term investments, analysts consider that plan conservative. Micron trades at a trailing price-to-earnings ratio of 11.64 and a forward non-GAAP multiple of just 4.98, and remains above its 200-day moving average.
