NEW YORK, July 15, 2026 – Micron Technology, Inc. (NASDAQ:MU) experienced a sharp decline on Wednesday, with shares falling 8.4% to $900.78 as of 11:52 a.m. EDT. The sell-off wiped out approximately $94 billion in market capitalization, surpassing the $85.6 billion valuation expected for Chinese rival ChangXin Memory Technologies (CXMT) in its upcoming Shanghai IPO.
CXMT's offering, which aims to raise up to 66.6 billion yuan (about $9.8 billion) if underwriters exercise all options, has investors on edge about potential increased DRAM supply. DRAM is a critical component in servers, PCs, and smartphones. The nearly doubled capital target—from an initial 29.5 billion yuan—signals aggressive expansion plans that could disrupt the current tight supply dynamics.
The valuation gap between the two companies is stark. According to Counterpoint Research, Micron held roughly 22% of global DRAM revenue in the first quarter, while CXMT accounted for about 8%. Based on Wednesday's market cap, each percentage point of DRAM market share costs approximately $46.9 billion for Micron, compared to just $10.7 billion for CXMT—a ratio of 4.4 times. However, this metric is not an apples-to-apples comparison, as Micron also sells NAND flash and high-bandwidth memory (HBM), while CXMT trails in advanced memory technology.
Eddie Tam, chief investment officer at Central Asset Investments, noted that CXMT's technology lags behind industry leaders Samsung Electronics (OTC:SSNLF) and SK hynix by two to four years. Micron has begun shipping HBM4 at scale for AI applications, a segment where CXMT is not yet competitive. However, the bulk of Micron's revenue—$31.3 billion or 76% in the fiscal third quarter—still comes from conventional DRAM, which could face pricing pressure if CXMT ramps up production.
Micron's near-term fundamentals remain robust. The company reported fiscal Q3 revenue of $41.46 billion and net income of $28.24 billion. For the fourth quarter, management guided revenue of $50 billion with a gross margin near 86%. CEO Sanjay Mehrotra stated that tight supply conditions are expected to persist beyond calendar 2027, supported by $22 billion in long-term supply agreements. Analysts like Donnie Teng of Nomura Holdings (NYSE:NMR) echoed this sentiment, noting that AI demand and cloud spending should absorb CXMT's additional supply.
Despite the bearish reaction, some analysts remain bullish. KeyBanc's John Vinh raised his price target on Micron to $1,750 from $1,600, projecting DRAM price increases of 15-20% in Q3 and another 15% in Q4. The stock had closed Tuesday up 4.9% at $983.12 before Wednesday's drop.
The outcome hinges on whether CXMT can effectively deploy its IPO proceeds to boost production and win customers outside China. U.S. export restrictions and technological gaps may limit its immediate impact, but the market is pricing in the risk of a price war in mainstream DRAM segments. Investors will watch CXMT's first-day trading performance, but the real signal will be how quickly it can convert capital into chips.
