The industry of memory chip come across an rising cycle during the last two years, especially DRAM memory chip. The gross margin of Samsung, SK Hynix and Micron, three DRAM manufacturers, is close to 70%, who are money drawing. However, the price rising of memory is generally considered stopping this year, and the cycle of declining is predicted to appear in 2019. Samsung reduced investment to prevent memory price falling, meanwhile, Micron paid attention to hottest AI area recently, announced investing one hundred billion dollar in start up companies.
Micron recently held Micron Insight 2018 convention, inviting companies such as Amazon, BMW, Qualcomm, Microsoft, NVIDIA and Visteon, as well as professors, writers and exploers of MIT, who discussing artificial intelligence, machine learning, deep learning and other new technologies. During the conference, Micron announced one hundred million investment funds to start up companies in AI area, 20% of which are led by women or disadvantaged.
Due to the worry about memory market turns to mark down next year, Micron was bet against by analysts as it’s share price declined few days ago. Micron’s consideration about AI area is multiple, seeking chance is one of it, and rising up company stock in passing. After the announcement, analyst of JPMorgan has boosted the price taget of Micron to 75 dollar and promise of Micron.
Expansive of AI market in memory and flash memory is a good news for Micron. During the earnings call in the first half year, Micron indicated that AI trianing of memory and flash memory will increase significantly. It is predicted that AI training needs to match 2.5TB momory and flash storage capacity increased to 20TB, which is much more higher than standard load.