TradingKey - Persistent high capital expenditure from Google and Tesla boosts Micron's stock rebound, with a potential return to historical peaks in the second half of 2026.
On July 23, Eastern Time, Micron Technology ( MU) extended its recent gains, briefly breaking through the $1,000 threshold during intraday trading to reach a high of $1,011.12. However, Micron's stock price pulled back late in the session, ultimately narrowing its gains to 3.2% to close at $990.21.
Micron stock price chart, Source: TradingView
From late June to mid-July, concerns over slowing AI capital expenditure and peaking memory prices led to a major correction in Micron's stock price, which fell continuously from a peak of $1,255 to a low near $798 on July 17, representing a maximum drawdown of 36% recently.
However, as Google's parent company Alphabet ( GOOG) and Tesla ( TSLA) raised their AI capital expenditure, particularly with Alphabet announcing an increase in full-year capital expenditure to expand AI data centers and computing power infrastructure, this not only reflects that large cloud service providers' demand for GPUs, HBM, and high-speed storage remains strong, but also directly benefits memory suppliers like Micron.
However, other major global AI infrastructure investors have not yet released their latest quarterly earnings or signaled AI expansion, such as Microsoft ( MSFT ), Meta ( META) and Amazon ( AMZN) among others. If these tech giants continue to increase capital expenditure, Micron, as a core HBM supplier, will directly benefit, which will further stimulate its stock price increase.
In contrast, if expectations for Federal Reserve rate cuts heat up, Micron's stock price is more likely to return to its historical peak in the second half of the year. Semiconductor stocks are typically high-growth stocks; if Fed rate-cut expectations rise and global tech stocks remain strong, it will facilitate a continuous inflow of capital into the AI supply chain. Conversely, if geopolitical risks escalate, oil prices surge, or interest rates remain high, tech stocks—especially AI concept stocks—will face pressure, and Micron will unlikely escape unscathed.
The continued upward revision of AI infrastructure Capex by tech giants allows Micron, as a key supplier of the AI computing foundation, to continue to benefit, meaning its fundamentals remain solid. From a technical analysis perspective, Micron staged a strong rebound after being oversold, demonstrating robust buying support. Currently, Micron is facing key psychological resistance at the $1,000 threshold; once it stabilizes above this level with heavy volume, it will quickly open the path to challenge its historical highs.
Find out more
Comments