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Micron Expands US Investment by $30 Billion Amid Trump’s Onshoring Push

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Micron Technology announced on Thursday a significant expansion of its U.S. investment plans, adding $30 billion to its existing commitments as President Donald Trump intensifies efforts to bring semiconductor manufacturing back to American soil. The memory chip maker now projects total investments of $200 billion, up from previous plans of approximately $125 billion.

The new funding will support the construction of a second cutting-edge memory fabrication facility in Boise, Idaho, and the expansion of its manufacturing site in Manassas, Virginia. “These investments are designed to allow Micron to meet expected market demand, maintain share and support Micron’s goal of producing 40% of its DRAM in the U.S.,” the company stated.

Micron’s DRAM chips are widely used in personal computers, automotive systems, industrial equipment, wireless communications, and artificial intelligence. The company’s High-Bandwidth Memory (HBM) products are seen as essential for powering next-generation AI models. About $50 billion of Micron’s total investment will be dedicated to research and development.

President Trump’s administration has pushed hard for semiconductor onshoring, with Trump threatening new tariffs on chip imports and reconsidering previous subsidies granted under former President Joe Biden. In December, Micron secured nearly $6.2 billion in government subsidies through Biden’s $52.7 billion 2022 CHIPS and Science Act. Trump’s administration is now renegotiating some of those grants, according to Commerce Secretary Howard Lutnick.

The expansion aligns with broader trends in the U.S. semiconductor industry. Nvidia, a key customer of Micron, announced plans in April to build AI servers worth up to $500 billion in the U.S. over the next four years, in partnership with firms such as Taiwan’s TSMC. “Micron’s investment in advanced memory manufacturing and HBM capabilities in the U.S., with support from (the) Trump administration, is an important step forward for the AI ecosystem,” said Nvidia CEO Jensen Huang.

Micron also finalized a $275 million direct funding award under the CHIPS Act to further support its Manassas facility expansion.

Samsung Faces AI Chip Sales Slowdown Amid U.S. Export Restrictions

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Samsung Electronics warned on Friday that its AI chip sales will be sluggish in the first quarter due to U.S. export restrictions on China, as well as a shift in demand toward more advanced chips. The company is working to launch an improved version of its high-bandwidth memory (HBM) chips in March to address these challenges.

Samsung’s struggles are compounded by its reliance on Chinese customers, who accounted for about 20% of its HBM sales. The U.S. government’s expanded restrictions on semiconductor exports have put additional pressure on the company, unlike its competitor SK Hynix, which remains Nvidia’s primary supplier of HBM chips for AI applications.

Kim Jae-june, Samsung’s executive vice president of memory, acknowledged that “temporary restrictions” would impact HBM sales but expressed optimism about future improvements. Meanwhile, Nvidia CEO Jensen Huang recently indicated that Samsung needs to “engineer a new design” to meet Nvidia’s standards.

Despite these efforts, Samsung reported a 29% decline in operating profit for Q4, totaling 6.5 trillion won ($4.48 billion). The company also faces headwinds in the mobile market, where competition from Apple and Chinese rivals has eroded profits. Samsung’s decision to use Qualcomm processors for its entire Galaxy S25 lineup, instead of its in-house Exynos chips, represents another setback for its semiconductor division.

While AI-driven demand for memory chips is expected to recover from Q2 onward, Samsung’s long-term performance will depend on its ability to mass-produce advanced 12-layer HBM3E chips for Nvidia.

 

Micron Shares Drop as Sluggish PC Demand and Weak Forecast Cloud AI Growth Potential

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Micron Technology’s shares fell by approximately 15% on Thursday after the company issued a grim forecast for the upcoming quarter, highlighting weak demand for personal computers (PCs) and smartphones, which overshadowed the positive growth in its AI-related chip sales.

Weak Demand for DRAM Chips

The market for dynamic random-access memory (DRAM) chips, which are commonly used in personal computers and smartphones, has been struggling since the end of the pandemic. This decline is driven by a lingering supply glut and continued sluggish demand from consumers. As a result, Micron’s forecast for its flash memory chip revenue in fiscal 2025 looks bleak, as these chips are heavily dependent on PC and mobile phone shipments. According to William Kerwin, an analyst at Morningstar, the post-pandemic growth in demand for traditional PCs has not met expectations, and AI-enabled computers have yet to achieve widespread popularity.

Slow Transition to Windows 11

Micron is also facing headwinds from the slower-than-expected adoption of Windows 11, after Microsoft announced the end of support for Windows 10. This gradual transition has contributed to the challenges in the broader PC market, impacting demand for memory chips.

If the losses hold, Micron’s market value could decline by more than $17 billion, bringing it to approximately $99 billion. This downward shift in value reflects concerns about Micron’s ability to recover from these demand-related issues.

Growth in AI Chips and High-Bandwidth Memory

Despite the challenges in the PC and mobile markets, Micron has seen strong growth in its high-bandwidth memory (HBM) chips, which are used in advanced AI systems. Revenue from these chips more than doubled sequentially, and Micron is positioning itself to take advantage of market expansion opportunities from data center investments in 2025. Analysts from Piper Sandler believe that Micron’s HBM segment remains intact and will continue to drive growth.

Micron is one of only three major HBM chip providers, alongside SK Hynix and Samsung, which has helped boost its stock by around 22% this year. Analysts expect HBM demand to remain a key driver of Micron’s performance moving forward.

Analyst Reactions

Despite the positive outlook for AI-related chips, at least 10 brokerages have lowered their price targets for Micron following its disappointing earnings results. According to data from LSEG, Micron’s 12-month forward price-to-earnings ratio is now 10.67, significantly lower than Qualcomm’s 13.4 and Advanced Micro Devices’ 23.97.