The rise of artificial intelligence (AI) has been a blessing in disguise for two prominent semiconductor stocks, NVIDIA Corporation NVDA and Micron Technology, Inc. MU. Both companies have posted strong quarterly performance recently, prompting investors to wonder which is the better buy right now and why. Let’s see –
Surging demand for Micron’s AI-focused high-bandwidth memory (HBM) chips helped the company post strong fiscal fourth-quarter and full-year results. For the fiscal fourth quarter, Micron’s revenues reached $11.32 billion, up from more than $7.75 billion a year earlier. The company’s net income was $3.2 billion, or $2.83 per share, compared to more than $887 million, or 79 cents per share, in the same period last year.
For the full fiscal year 2025, Micron’s revenues totaled $37.38 billion, up from over $25.11 billion the previous year. Net income was a healthy $8.54 billion, or $7.59 per diluted share.
Most importantly, in the latest reported quarter, Micron’s key cloud memory business unit reported $4.54 billion in sales, more than tripling year over year. Leveraging the demand for HBM chips, known for their ability to reduce power consumption and process large volumes of data, Micron has raised its fiscal first-quarter revenue guidance to $12.5 billion.
Micron’s CEO, Sanjay Mehrotra, expressed strong optimism about the company’s future, stating that they are “entering fiscal 2026 with strong momentum and our most competitive portfolio to date. As the only U.S.-based memory manufacturer, Micron is uniquely positioned to capitalize on the AI opportunity ahead,” citing investors.micron.com.
And why shouldn’t he? The rising demand for Micron’s HBM chips, used in some of NVIDIA’s semiconductors and several AI-enabled smartphones, is likely to boost Micron’s performance soon. Additionally, Micron’s initiative to increase chip production in the United States helps shield the company from tariff-related risks.
NVIDIA has recently strengthened its partnership with one of its largest customers, further solidifying its position as a leading provider of AI training and development in the tech industry. NVIDIA has pledged to invest $100 billion in the San Francisco startup, OpenAI. This deal will involve supplying at least 10 gigawatts of NVIDIA systems to OpenAI.
Also, NVIDIA’s plan to invest $5 billion in Intel common stock will help develop niche products for data centers and personal computers, improving application performance across hyperscalers and consumers (read more: Is NVIDIA’s $5B Stake a Signal to Buy, Hold, or Sell Intel Stock?).
