Micron exits consumer memory market to focus on AI demand amid the global semiconductor crisis.
Micron announces exit from crucial consumer business to prioritize the growing demand for advanced memory chips used in AI data centers. Amid a global semiconductor shortage, the company plans to refocus its efforts on higher-margin products essential to AI, such as high-bandwidth memory (HBM).
Micron’s decision comes as the memory chip supply chain continues to face unprecedented challenges. Lately, memory semiconductors are in high demand. HBM, a more complex form of dynamic random access memory (DRAM) that uses vertical chip stacking for reduced power consumption, has become indispensable in data-heavy AI environments. Sumit Sadana, Micron's business chief, said,
"Micron has made the difficult decision to exit the Crucial consumer business in order to improve supply and support for our larger, strategic customers in faster-growing segments."
While Micron plans to cease the sale of Crucial-branded consumer memory products at retailers and e-tailers worldwide, shipments will continue until February 2026. Analysts note that the consumer memory unit has not been a significant revenue driver for Micron, which makes the shift easier to manage.
In the August quarter, Micron's HBM revenue soared to nearly $2 billion, reflecting the company’s increased focus on the AI sector. This high-margin business has become a major growth engine for Micron, with the company projecting a nearly $8 billion annualized revenue from HBM. Micron CEO Sanjay Mehrotra further said,
"We’re betting on AI…The increased demand for data storage in AI applications is only going to accelerate."
Micron’s stock has performed well this year, rising by 175%, though it slipped by 3% on Wednesday to $232.25 following the announcement. Analysts remain optimistic, with Goldman Sachs raising the stock’s target price to $205, citing strong pricing momentum in the memory sector.
Micron has not provided details on whether the shift will lead to layoffs, though the company emphasized its commitment to minimizing the impact on employees. The company stated,
"Micron intends to reduce the impact on team members due to this business decision through redeployment opportunities into existing open positions."
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