Chip panic meets blowout earnings — momentum bounce on Micron and AI server plays
Chip and AI stocks took a beating over the last few days as investors worried the AI boom was cooling. But Micron just shattered those doubts with massive earnings and a skyrocketing stock price, proving the demand for AI tech is stronger than ever.
Idea
Earlier this week, a global chip sell-off gripped Wall Street, dragging the Nasdaq down 2.4% and causing panic that the AI trade was cooling off. However, Micron completely shattered those fears by reporting that its revenue more than quadrupled, sending its stock up over 16% premarket. When you combine this week's recent fear-driven plunge in tech with Micron's blockbuster proof that AI demand is actually accelerating, it sets up a classic relief rally. The companies that were unfairly punished in the panic—like AI server makers Super Micro and Nvidia—are primed to bounce back sharply as investor confidence returns.
What happened since
| Symbol | Dir | T+1 | T+5 | T+20 |
|---|---|---|---|---|
| NVDA | LONG | -1.64% ✗ | +2.22% ✓ | +8.56% ✓ |
| MU | LONG | -6.69% ✗ | -4.88% ✗ | -25.49% ✗ |
| SMCI | LONG | -3.31% ✗ | -7.42% ✗ | -15.12% ✗ |
Price change since publication · updated Jul 15
Advanced analysis
Can Micron's 48.9% revenue growth and Nvidia's $96.8B free cash flow overcome a basket dragged down by SMCI's 79.9% drawdown?
With Super Micro's gross margin at just 11% and Micron's free cash flow historically swinging from $8.5B to negative, how much downside risk lurks beneath the AI demand narrative?