Key Takeaways
- SK Hynix ADRs surged 6.7% while Micron climbed 3.5% in Thursday’s premarket session
- Google parent Alphabet increased 2026 capital expenditure guidance to $195Bâ$205B from $180Bâ$190B
- The two companies dominate HBM chip supply for AI-focused data center infrastructure
- Supply constraints for SK Hynix ADRs after hitting 2.5% conversion threshold amplify price movements
- Tesla CEO Elon Musk publicly acknowledged Micron during earnings for securing chip allocations amid tight supply
Memory chip manufacturers enjoyed a strong Thursday morning after Alphabet delivered earnings results that significantly bolstered the outlook for AI infrastructure spending.
Shares of Micron (MU) advanced 3.5% during premarket hours. SK Hynix ADRs (SKHY) jumped even higher, posting a 6.7% gain. The catalyst? Alphabet’s decision to elevate its 2026 capital spending projections to a range of $195 billion to $205 billion, representing a substantial increase from the previously announced $180 billion to $190 billion guidance.
This elevated spending commitment translates directly into expanded data center construction, which drives heightened demand for the specialized memory chips these manufacturers produce.
According to CFO Anat Ashkenazi, the upward revision stems from accelerated capacity deployment timelines aimed at satisfying customer requirements. Essentially, Google is accelerating its buildout schedule and requires additional hardware components immediately.
High-bandwidth memory technology, commonly referred to as HBM, serves as a critical component in AI server architecture. With Alphabet’s infrastructure expansion gaining momentum, Micron and SK Hynixâboth leading HBM providersâare positioned to capture substantial business growth.
This upward momentum arrives at an opportune moment for both companies. Micron has declined approximately 9% during the past 30 days. SK Hynix’s Seoul-traded shares have experienced an even steeper correction of nearly 25% over the identical period, reflecting investor anxiety about potential pricing deterioration and concerns over Big Tech capital spending sustainability.
Alphabet’s Wednesday evening disclosure provided meaningful reassurance against these fears, at least in the near term.
Limited ADR Supply Amplifies SK Hynix Movement
Despite launching its U.S. trading presence just on July 10, SK Hynix has already encountered an uncommon market restriction. The company reached the 2.5% conversion ceiling for transforming Korean-listed equity into U.S.-traded ADRs. This effectively halts any additional supply from entering the American marketplace temporarily.
When sustained buyer interest meets restricted availability, price acceleration typically follows. This supply-demand imbalance partially explains why SK Hynix’s 6.7% premarket surge exceeded Micron’s percentage gain.
The Korean chipmaker continues aggressive production capacity expansion. Its board recently authorized a âŠ7.09 trillion capital allocation toward constructing an advanced packaging facility located in Cheongju. Investors will receive SK Hynix’s second-quarter financial results on July 29.
Tesla CEO Highlights Micron’s Strategic Support
Micron received unexpected public recognition from an unconventional source. During Tesla’s quarterly earnings discussion, Elon Musk specifically acknowledged Micron for securing substantial memory chip volumes for Tesla under favorable commercial termsâwhile characterizing broader memory market pricing as “insane.”
This statement illuminates the severe supply constraints currently affecting the semiconductor industry. Companies are aggressively competing to secure component allocations, positioning Micron to capitalize on both shipment volumes and favorable pricing dynamics as it scales production of next-generation memory technologies.
According to TipRanks analyst consensus, Micron holds a Strong Buy rating, supported by 29 Buy recommendations and a single Hold rating accumulated over the previous three months. Analysts’ average price target of $1,569.29 suggests approximately 64% potential appreciation from present trading levels.
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