MEHROTRA SANJAY sold $2.5M of MU

Apple (AAPL) lost $140B in market value after guiding lower gross margins due to 'unprecedented' memory prices. Micron (MU) benefits, with gross margin rising to 86.8% and expected EPS doubling by fiscal 2027. Apple's higher memory costs are driven by firms like Micron.

Micron Technology (MU) stock rose 3.3% to $86.11, driven by a rebound in the memory chip sector. Apple's earnings report highlighted rising memory costs, while SK Hynix reported strong demand and supply constraints. Micron may increase stock repurchases post-CHIPS Act restrictions. The broader chip sector also recovered, with several tech stocks gaining over 3%.

Apple (AAPL) warned of 'unprecedented' memory pricing, expecting costs to rise beyond December. This impacts margins, with December quarter gross margin forecast at 45-46%, down from 47.9%. Memory costs drove a 1% margin decline from June to September. Apple raised prices on devices to offset costs. Micron (MU), SK hynix (SKHY), and Samsung (005930.KS) face supply constraints and pricing power due to AI demand, but China's expanding memory production poses long-term risks.

SanDisk (SNDK) surged 7% after a 35% monthly decline, rebounding from a Kioxia selloff. Kioxia's flat profit guidance and slowing NAND price gains impacted memory stocks. SanDisk's peers, Micron (MU) and Western Digital (WDC), also rose 4%. SanDisk's direct NAND exposure and long-term contracts may support demand. Analysts' views are mixed, with targets ranging from $1,300 to $2,000. Apple's (AAPL) comments on rising memory costs provide a positive signal.

Marvell Technology agreed to buy Lumentum Holdings in an all-stock deal valued at $115B, including debt. Marvell shares fell 12.7% and Lumentum dropped 18.6% on the news. The deal, expected to close by 2028, aims to create an AI connectivity leader, with Marvell shareholders owning about two-thirds of the combined company. Both companies' stocks underperformed the implied deal price, reflecting market doubts about the terms and timing.

Samsung Electronics announced that its 2027 high-bandwidth memory (HBM4) supply is sold out at target prices. HBM4 sales tripled in Q3 2026, and the company expects strong demand to continue. SK hynix and Micron also reported tight supply and high demand for HBM through 2027-2030. Samsung aims for long-term contracts covering 60-70% of its capacity through 2030, according to the company.