Micron Technology is Buy on AI Growth, Tariff Tailwinds, and Bullish Patterns

Micron Technology Inc. (MU) is emerging as a top beneficiary of shifting US chip policy and global trade realignment. The company gains from rising tariffs on foreign chips and strong support under the CHIPS Act. With expanding domestic operations and leadership in AI memory demand, Micron stands out in a competitive market. Its record-breaking financial results, high revenue growth estimates, and bullish technical setup further strengthen its case. This article explores why Micron is well-positioned for long-term upside and remains a strong buy for investors.

Micron Gains Strategic Edge from US Chip Policy and Tariff Risks

The global chip industry is entering a new era of strategic reshuffling. The Biden administration’s push for onshore semiconductor production has intensified. Tariff threats against foreign-made chips are prompting companies to build or acquire plants in the US. This development is relevant for Micron, which already operates US-based fabrication facilities. As foreign rivals move production stateside to avoid tariffs, Micron gains a relative advantage in the near term.

Micron is well-positioned under the current US industrial policy. The $52.7 billion CHIPS Act is already benefiting companies with domestic operations. Since Micron is building new plants in Idaho and New York, it may receive a bigger share of subsidies and grants. This reduces long-term capital burden and strengthens Micron’s competitive standing against Asian peers who are just beginning their US expansion. Investors may view this favorably, supporting the stock price in anticipation of better margins and government support.

On the other hand, the tariffs on Chinese chip firms like Huawei and SMIC could limit US imports of lower-cost components. This may boost pricing power for US-based memory manufacturers. If component tariffs are not included, the impact may be muted. However, if broad tariffs are applied, Micron’s domestic production footprint becomes even more valuable. This geopolitical tailwind could help Micron recover from cyclical downturns and support a bullish rerating by investors.

Competitive Threats and Cost Pressures May Limit Upside for Micron

Taiwan Semiconductor Manufacturing Company Ltd. (TSM) and Samsung are aggressively expanding in the US and have greater financial flexibility. TSMC supports key clients like Nvidia Corp. (NVDA), which limits Micron’s market capture in high-end segments like AI chips. While Micron is dominant in DRAM and NAND, it lacks presence in leading-edge logic chips. Therefore, competitive threats from deeper-pocketed firms could cap the upside potential unless Micron innovates aggressively.

Moreover, the global realignment of supply chains may also increase cost pressures. Building fabs in the US is significantly more expensive than in Asia. Micron’s margins could be squeezed in the short term, especially as demand remains uncertain and memory chip prices remain volatile. Investors need to monitor how effectively Micron manages this cost curve while competing with global giants under the same industrial policy.

Despite these risks, the stock could benefit from sentiment-driven inflows. Recent rallies in TSMC and GlobalWafers after tariff-related news show investors reward companies with strong US strategies. If Micron highlights further progress in local expansion or wins large subsidies, its stock may see renewed interest.

The chart below shows that Micron Technology shows the strongest revenue growth estimate among peers at 46.71% for the current fiscal year. This estimate is far surpassing ARM Holdings (18.65%) and Analog Devices (ADI) (12.78%), Intel Corp. (-2.04%) and Qualcomm Inc. (QCOM). This sharp growth reflects Micron’s leadership in AI-driven memory demand and positions it as a top pick for investors seeking high-growth semiconductor exposure.

Micron Technology Posts Record-Breaking Q3 Revenue Surge

Micron Technology reported record revenue of $9.301 billion in fiscal Q3 2025. Specifically, this marked a 15.5% increase from Q2 2025 and a 36.5% increase from Q3 2024. Surging demand for high-bandwidth memory (HBM) fueled this impressive growth, with the segment growing nearly 50% sequentially.

Additionally, strong sales in the data centre and consumer markets supported broader revenue momentum. Moreover, the company’s diversification across end markets helped reduce risk and drive top-line strength. As shown below, the chart highlights consistent revenue growth since 1990.

Micron reports a strong net income of $1.885 billion, alongside an operating cash flow of $4.609 billion, as shown in the chart below. This performance reflects stronger pricing, improved product mix, and higher volumes. The company’s profitability increased in tandem with scale, while cost discipline and factory efficiency supported margins.

Micron maintained a strong balance sheet with $12.22 billion in liquidity. The capital spending remained disciplined, with $2.66 billion in net capex investments. Moreover, the free cash flow reached $1.671 billion, supporting growth initiatives and shareholder returns.

The chart below shows that the company’s dividend is $0.115 and is consistently increasing. This growth indicates confidence in its financial stability. Overall, Micron’s strong financials show it is executing well in a competitive market, with AI-related tailwinds likely to sustain future gains.

Micron’s Long-Term Bullish Patterns and Key Buy Zones

Broadening Wedge and Inverted Head and Shoulders Support Long-Term Growth

The long-term price outlook for Micron shows intense volatility, with the stock moving within a broadening wedge pattern. Initially, the price formed a bottom in 2016 around $9.09 and then surged to a record high of $156.66 in June 2024. Together, these highs and lows have created a broadening wedge structure, reflecting wide price swings within the pattern.

Subsequently, the first major buy signal emerged in March 2020 at the wedge’s lower boundary, around $30.40. Then, the second buy signal appeared in September 2022 at $47.60, followed by a third in April 2025 at $61.48. In each case, the signal led to a strong rally in Micron’s stock price, reinforcing bullish sentiment.

The overall price structure remains bullish, supported by a large inverted head and shoulders pattern formed near the 2009 region. This classic bullish reversal formation signals long-term strength and has been recognised by many market participants. The presence of this pattern adds confidence to the view that Micron’s long-term uptrend is intact.

Therefore, any correction in Micron’s stock price toward previous buy zones could present a strong buying opportunity for long-term investors. The combination of bullish technical patterns and recurring rebound zones supports a constructive outlook.

Support Levels and Short-Term Buy Signals Offer Opportunity

Since the price has been trading with high volatility, long-term support has been established around the $95 to $100 area, which serves as a key buy zone for traders. Additionally, the 61.8% Fibonacci retracement level is located near $65, where the stock previously found support in 2025 at $61.48.

After reaching that level, Micron rebounded sharply, rallying to a high of $129.73 before entering a consolidation phase to form the next bottom. A correction toward the $100 zone is seen as a strong buying opportunity for investors. This area offers favourable risk-reward potential as the stock positions itself for a move toward new record highs.

The daily chart for Micron shows that the stock has already reached the $100 to $102 range, highlighted by the blue shaded zone, and has begun to rebound from this level. Short-term traders can consider initiating positions at this support area. The red trendline acts as the neckline of an inverted head and shoulders pattern, indicating that the stock may be forming a bottom before the next upward move. A breakout above the $130 region would likely trigger a rally toward new highs.

Conclusion: Why Micron Is a Strong Buy

Micron stands at the forefront of the US chip resurgence. The company benefits directly from industrial policies like the CHIPS Act and rising geopolitical tensions that favour domestic producers. Moreover, its expanding US footprint and early investments in fabrication capacity give it a strategic lead over global rivals just starting to localise.

Financially, Micron presents a strong financial standing. The company posted record revenue in Q3 2025 and expects double-digit growth in Q4. In addition, its strong net income, robust cash flow, and growing free cash flow show operational strength. With nearly $12.22 billion in liquidity and disciplined capex, the company is well-equipped to support future innovation and shareholder returns. Furthermore, the consistent dividend also signals financial confidence.

From a technical standpoint, the stock remains within the strong bullish trend. Notably, the emergence of a broadening wedge and consistent buy signals at historical support levels indicates future growth potential. As AI demand accelerates and tariffs reshape the market, Micron’s combination of growth and technical strength makes it a compelling long-term investment. Therefore, investors can consider adding positions within the $90-$100 range and hold them for long-term growth.