Key Takeaways
- Micron shares plummeted 7.7% during Thursday’s trading session, eliminating $94.24 billion from its market capitalizationâthe company’s most significant single-session loss on record.
- The decline followed Broadcom’s quarterly earnings release, which underwhelmed market participants by maintaining unchanged AI revenue projections.
- Broadcom experienced a $286 billion market cap reduction, marking the fourth-largest one-day value loss for any American corporation in history.
- Semiconductor stocks broadly declined, with AMD falling 3.6%, Intel dropping 0.8%, and the PHLX Semiconductor Index retreating 2.2%.
- Market participants await Micron’s June 24 earnings announcement for updated insights regarding AI memory chip demand trends.
Micron Technology (MU) shares experienced a severe downturn Thursday, declining 7.7% and eliminating $94.24 billion from its market capitalization within a single trading day. This represents the memory chipmaker’s most substantial one-day valuation loss in company history.
The sharp decline followed Broadcom‘s (AVGO) quarterly earnings announcement, which analysts characterized as solid yet failed to satisfy investor expectations. The primary concern centered on Broadcom’s decision to maintain its existing AI revenue forecast rather than raising projections, disappointing market participants anticipating more optimistic guidance.
Broadcom absorbed significant losses as well, with shares tumbling 12.6% and erasing $286 billion in market valueârepresenting the fourth-largest single-session market cap decline for any U.S. corporation in recorded history.
The negative sentiment reverberated throughout semiconductor stocks. AMD retreated 3.6%, Intel declined 0.8%, and the PHLX Semiconductor Indexâa comprehensive benchmark tracking chip manufacturersâfell 2.2%. Notably, Nvidia bucked the trend, advancing 1.94%.
D.A. Davidson analyst Gil Luria characterized Broadcom’s financial performance as “impressive” while recognizing the report’s dampening effect on semiconductor sector sentiment.
Micron’s Recent Momentum Before the Decline
Prior to Thursday’s selloff, Micron had demonstrated remarkable strength. The memory chip manufacturer recently achieved its inaugural closing price above $1,000 per share, pushing its total market valuation near $1.2 trillion.
Wall Street analysts had been elevating price targets, highlighting several favorable developments on the horizon. Particularly significant: Nvidia’s anticipated launch of next-generation personal computing processors featuring expanded memory capacity specifications, which market watchers view as potentially beneficial for Micron’s business prospects.
Itau BBA analyst Stephano Gabriel recently indicated increasing evidence suggesting memory chip supply constraints are “intensifying.” This development represents positive news for Micron, Gabriel contended, as it indicates elevated memory pricing reflects structural supply-demand dynamics rather than temporary cyclical fluctuations.
Gabriel anticipates additional long-term supply contracts will be finalized at prevailing premium prices, potentially providing Micron with enhanced revenue visibility and stability.
“This helps ease peak-cycle concerns,” he said.
Valuation Considerations and Forward Outlook
Despite optimistic analyst perspectives, cautionary signals had emerged. Analyst price objectives remained substantially below recent market prices, while corporate insiders had executed notable stock sales in recent periods.
Broadcom’s unchanged AI revenue projectionsârather than upward revisionsâproved sufficient to spark profit-taking among investors in richly-valued semiconductor companies like Micron that had experienced substantial appreciation leading up to the announcement.
Micron’s upcoming quarterly earnings announcement is scheduled for June 24. Market participants will scrutinize management’s updated commentary regarding AI memory demand trajectories, supply contract developments, and whether memory supply constraints continue intensifying.
An industry communication dated June 3 had highlighted potential AI memory chip supply limitations across critical market segmentsâanother factor investors will evaluate against Micron’s forthcoming guidance later this month.
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