Micron Technology CEO Sanjay Mehrotra has revealed how innovation is boosting growth in end markets such as data centers, PC and smartphone.
Data center market
Micron Technology is making significant strides in the data center market, supported by robust demand and advancements in its product offerings. The company has seen increasing traction in AI server growth alongside a refresh cycle for traditional servers, which has helped boost demand for DRAM and NAND storage solutions.
Research firm Gartner says spending on data center systems will reach $293.091 billion (up 24 percent) in 2024, driven by the increasing compute power demands of GenAI.
Micron Technology achieved record revenue in fiscal 2024 from data center sales and anticipates further growth in fiscal 2025, driven by its high-bandwidth memory (HBM), high-capacity DRAM solutions like D5 and LP5, and data center SSD products.
Micron is positioning itself as a leader with its HBM products, as the total available market (TAM) for HBM is expected to surge from $4 billion in 2023 to over $25 billion by 2025. The company’s advanced HBM3E 12-high 36GB units have attracted strong demand, with Micron set to ramp up production in early 2025.
Micron’s D5 and LP5 solutions, designed with AI and data center needs in mind, are also gaining rapid adoption. The company is utilizing innovative LP5 solutions to improve server reliability and efficiency, while its SSD offerings, built on vertically integrated designs, have led to substantial market share gains. Micron’s data center SSD revenues tripled in fiscal 2024, with a quarterly record of over a billion dollars in Q4 alone.
PC market
Micron Technology is driving growth in the PC market as demand for memory and storage surges due to the rise of AI-powered PCs. With PC customers increasing inventory levels in anticipation of higher memory prices and tighter supply driven by growing demand in data centers, Micron is well-positioned to capitalize on these trends.
Canalys says sale of AI-PCs in North America will account for 30 percent of the total PC market in Q4 2024 and 50 percent in Q4 2025.
Micron anticipates stronger growth in the PC market in 2025, fueled by the rollout of next-gen AI PCs, the transition from Windows 10 to Windows 12, and a PC replacement cycle. As AI functionalities become integral to enhancing productivity and user experience, memory and storage requirements are rising.
AI-enabled PCs are being launched with significantly higher memory capacities, with leading OEMs introducing models featuring a minimum of 16GB of DRAM for value PCs and up to 64GB for premium models, compared to last year’s average of 12GB.
Micron’s product portfolio, including client LPDRAM, DRAM, and SSD solutions, is well-aligned with the evolving needs of AI PCs. The company’s low-power compression attached memory module (LPCAMM2) has garnered multiple design wins, offering substantial power savings, better performance, and space efficiency. Micron’s 3500 client SSD is qualified at major PC OEMs, providing the power and performance enhancements crucial for AI-driven workloads.
Smartphone market
Micron Technology is making significant strides in the smartphone market, as evolving inventory dynamics and increasing demand for AI features drive growth. Smartphone unit volumes are projected to rise in the low to mid-single-digit percentage range for calendar 2024, with continued growth expected into 2025.
Canalys says global smartphone market – in terms of shipment – rose 10 percent to 296.2 million units in Q1 2024, achieving double-digit growth after 10 quarters.
Smartphone manufacturers are increasingly focusing on differentiation through enhanced AI capabilities, such as personalized recommendations, advanced camera functionalities, and smarter voice assistants.
Leading Android OEMs have recently introduced AI-enabled smartphones featuring between 12GB and 16GB of DRAM, a notable increase from the average of 8GB found in flagship devices last year.
A IDC blog has noted two smartphones with 16GB of DRAM. TECNO POVA 6 Neo 5G smartphone has 16 GB of RAM, 256 GB of storage, and AI features like AIGC and Magic Eraser. It also has an 8 MP front camera with AI and a dual-color flash. Pixel 9 Pro XL 5G AI smartphone has 16 GB of RAM and 256 GB of storage.
Micron is well-positioned to meet this demand with its memory and storage solutions. The company has achieved a significant milestone with the first customer qualification of its second-generation 1β-based LP5X DRAM and second-generation G8 NAND UFS 4.0 products during the quarter. These advancements reinforce Micron’s commitment to supporting the evolution of AI smartphones, providing the necessary performance enhancements to accommodate the increasing complexity of smartphone applications.
Baburajan Kizhakedath
