Micron Shares Drop 32% Amid AI Infrastructure Spending Concerns

Shares of Micron Technology have declined 32% from their June record high, driven by investor concerns over whether the high cost of AI infrastructure is sustainable. Despite reporting record fiscal 2026 third-quarter revenue of $41.5 billion and beating estimates with a 345% increase, the company faces a volatile market. The stock further declined following second-quarter results from SK Hynix, which reported a 557% surge in operating profit to $41.7 billion but still missed analyst expectations, triggering a sector-wide sell-off.

Financial viability concerns are prompting shifts across the tech industry. Microsoft and Anthropic have raised software prices, while Apple increased prices on nearly all devices, citing high memory costs. Corporate users such as Uber Technologies, Amazon, and Walmart have capped employee AI usage to prevent budget overflows; Uber reportedly exhausted its 2026 AI budget within four months. A UBS Group survey found that 60% of businesses are moving toward cheaper AI models to reduce expenses.

To mitigate these risks, Micron has secured 16 strategic customer agreements extending through 2030, with 14 of those guaranteeing at least $100 billion in minimum revenue. Chief Executive Officer Sanjay Mehrotra maintains that tight market conditions will persist beyond 2027 due to AI-driven demand and structural supply constraints. SK Hynix management similarly expects shortages to continue through 2030.