Artificial intelligence demand has reached a new peak, with two chipmakers crossing the $1 trillion stock market valuation threshold within days of each other.
Micron Technology (NASDAQ: MU) surpassed the $1 trillion mark for the first time on Tuesday, driven by surging demand for memory chips used in AI applications.
South Korean chipmaker SK Hynix joined the trillion-dollar club the following day, with its shares having climbed more than 200% this year alone.
Micron’s rise was remarkably swift, reaching the $1 trillion milestone just 48 days after hitting a $500 billion valuation, moving faster than Meta, Amazon, Nvidia, Walmart and Tesla, according to a Wall Street Journal analysis.
Samsung, another of the world’s largest memory chip suppliers, also crossed the $1 trillion threshold earlier this month, signaling a broader industry surge tied to AI investment.
Since Apple first broke the trillion-dollar level in 2018, 11 more U.S. companies have since followed, with the milestone becoming increasingly common amid relentless AI-driven market momentum.
UBS analysts added to the excitement on Tuesday morning, tripling their price target for Micron to $1,625 per share from $535, which helped send the stock surging 19% on what became its fifth-best trading day on record.
Goldman Sachs strategists predicted earnings will grow by 24% this year, with half of that growth coming from companies that are “the beneficiaries of AI infrastructure investment.”
Beyond AI, broader earnings strength is also lifting markets, with S&P 500 companies reporting their highest profit growth since 2021 this earnings season, according to data from FactSet Research.
FactSet analyst John Butters noted that “in aggregate, earnings reported by the ‘Magnificent 7’ companies exceeded estimates by 32.5%, compared to 16.6% for all S&P 500 companies,” with the group comprising Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla.
Yardeni Research founder Ed Yardeni predicted the S&P 500 will rally to 8,250 by year-end, currently the highest year-end target among Wall Street analysts, with Oppenheimer, Deutsche Bank, Morgan Stanley and Goldman Sachs all setting targets at or near 8,000.
Goldman Sachs chief U.S. equity strategist Ben Snider stated that “continued earnings growth should drive continued equity market upside,” adding that “earnings strength has been the key differentiator between the recent market run and similar narrow rallies in the past.”
However, Snider also cautioned that the outperformance of AI-linked stocks “raises their hurdle going forward,” while the energy shock from the ongoing Iran war “threatens to create the conditions of disappointing growth and tightening financial conditions that have marked the ends of previous bull markets.”
Futures market traders currently see a 60% chance the Federal Reserve will raise interest rates by year-end, a move that could weigh on stocks and corporate profits, with the Fed’s next rate decision scheduled for June 17.
