Micron Secures $150 Billion in Long-Term Orders Amid Worsening AI Memory Shortage
Micron Technology announced it has secured approximately $150 billion in long-term orders across 26 customer agreements, warning that memory supply shortages will intensify through fiscal years 2027 and 2028. Customer cash prepayments under these long-term agreements have surged to $32 billion, up from $22 billion reported in June. Memory, particularly High Bandwidth Memory (HBM), has overtaken logic processors and power infrastructure as the main bottleneck for AI scaling. Micron's tight supply through 2028 indicates that chipmakers will struggle to keep pace with the hundreds of billions of dollars tech giants are spending on AI data centers. Micron has already committed most of its fiscal 2027 HBM production capacity and is expanding manufacturing facilities in the US and Japan, with first wafer production expected by mid-2027. However, company executives noted that dimishing technical returns and multi-quarter ramp-up periods mean new capacity will take time to meaningfully alter market balance.
## BACKGROUND
High Bandwidth Memory (HBM) is a high-performance DRAM architecture that stacks multiple memory dies vertically to deliver massive bandwidth and reduced power consumption. It is a critical component for AI chips like NVIDIA GPUs, which require rapid data retrieval to process huge deep learning models.