AI_header

Micron, memory chips, and the artificial intelligence bill: what 2025 teaches investors

Equities 5 minutes to read
Ruben Dalfovo
Ruben Dalfovo

Investment Strategist

Key takeaways

  • Memory, not only graphics chips, sets artificial intelligence speed and cost, and tight supply can shift pricing power.

  • Micron’s outlook points to strong demand and heavy investment, but the memory cycle still matters.

  • Oracle’s data centre snag shows artificial intelligence growth needs financing and execution, not just excitement.


On 17 December 2025, markets give artificial intelligence (AI) a late-year reality check. The Standard and Poor’s 500 (S&P 500) closes at 6,721.43, down 1.2%, and the Nasdaq Composite ends at 22,693.32, down 1.8%. The move feels less like “AI is over” and more like “show me the bill”. After a year of big promises, investors lean into three practical questions: where the bottleneck sits, who has pricing power, and how quickly today’s spending turns into tomorrow’s cash.

The “how fast” problem, without a chip dictionary

A graphics processing unit (GPU) can only work as fast as it can fetch data. Modern AI models move huge amounts of information between the processor and memory. If that pipe is narrow, the GPU waits.

Two memory terms matter. Dynamic random-access memory (DRAM) is the server’s working memory. High-bandwidth memory (HBM) is a premium form of DRAM stacked and placed close to the GPU, so data moves faster and with less power.

When HBM is scarce, memory makers gain negotiating power. That is the quiet reason the “AI trade” is also a memory story.

Micron’s quarter: when “boring” becomes business-critical

Micron reported results on 17 December 2025 and leans into a simple message: memory is no longer the quiet sidekick in the AI story. The company’s quarter lands ahead of expectations, but the bigger surprise sits in the outlook. Management points to a step-up that comes in well above what Bloomberg analysts expect, driven by data centre demand and the scramble for high-bandwidth memory (HBM), the premium “fast lane” memory used next to AI accelerators.

Compared with this time last year, the change is stark: Micron’s fiscal first-quarter revenue rises to 13.64 billion USD from 8.71 billion USD a year earlier, and management talks about record performance and supply that still does not fully meet demand. In plain English, customers want more chips than the industry can comfortably ship, and that is when pricing tends to behave better. Management also points to a much higher 2026 capital expenditure plan (money spent on factories and equipment) and warns tight supply can persist beyond 2026. That combination supports pricing power, but it raises execution risk because the industry is building expensive capacity fast.

Nvidia and Oracle: demand is loud, financing is louder

Nvidia designs the GPUs (graphics processing units) that do the heavy lifting in AI training and inference, but the system is only as strong as everything around the GPU. More GPUs pull the whole chain forward: more HBM, more networking, more electricity, and more data centres.

Oracle sits in that “buildings and power” layer as it expands cloud capacity and chases large AI workloads, including projects linked to OpenAI. On 17 December 2025, Oracle shares close down 5.4% at 178.46 USD after reports that a planned Michigan data centre project hits turbulence when Blue Owl Capital steps back from funding talks. The market takeaway is not that demand disappears. It is that AI now looks like infrastructure, and infrastructure lives and dies by terms, financing, and payback periods.

Risks: the early warning signs worth watching

Memory remains cyclical. A pause in cloud capital expenditure can cool demand and pressure pricing quickly. Watch for softer spending plans and rising inventories.

HBM is also hard to scale. Yield issues, packaging bottlenecks, or faster progress by rivals can squeeze margins. Watch for customer qualification updates and any shift in multi-year supply agreements.

Finally, watch the profit gap. AI can grow revenue and costs at the same time. If services do not price well enough to cover the infrastructure bill, valuations can reset across the theme.

Investor playbook: practical, observable signals

  • Track AI as a supply chain: GPUs, memory, networking, and data centres, not one hero stock.

  • Prioritise cash flow direction and capital discipline over headline growth rates.

  • Use diversification and position sizing to respect volatility in cyclical semiconductors.

  • Watch concrete signals: capital expenditure guidance, HBM allocation comments, and data centre utilisation.

From software dreams to concrete reality

The tidy ending to 2025 is that the AI story grows up. In January, it feels like software magic. By December, it looks like concrete, cables, and contracts. Micron’s quarter shows why: even the best GPU cannot run if memory bandwidth is scarce. Oracle’s funding snag shows the other half: the buildings and power systems need willing financiers.

For a long-term investor, the lesson is not to chase every headline. It is to follow where the economics settle, and to remember that boring components often set the speed. Price the plumbing first, then enjoy the magic. That mindset helps when the next wobble arrives, because it usually does.






This material is marketing content and should not be regarded as investment advice. Trading financial instruments carries risks and historic performance is not a guarantee of future results.

The instrument(s) referenced in this content may be issued by a partner, from whom Saxo receives promotional fees, payment or retrocessions. While Saxo may receive compensation from these partnerships, all content is created with the aim of providing clients with valuable information and options.

Outrageous Predictions 2026

01 /

  • Carry trade unwind brings USD/JPY to 100 and Japan’s next asset bubble

    Outrageous Predictions

    Carry trade unwind brings USD/JPY to 100 and Japan’s next asset bubble

    Charu Chanana

    Chief Investment Strategist

    A Trump-driven Fed pivot crashes the carry trade, hurling USD/JPY to 100 and unleashing Japan’s wild...
  • Drone taxis make Singapore skies the new causeways

    Outrageous Predictions

    Drone taxis make Singapore skies the new causeways

    Charu Chanana

    Chief Investment Strategist

    Singapore transforms regional travel with electric air taxis that replace causeways and ferries, tur...
  • A Fortune 500 company names an AI model as CEO

    Outrageous Predictions

    A Fortune 500 company names an AI model as CEO

    Charu Chanana

    Chief Investment Strategist

    Can AI be trusted to take over in the boardroom? With the right algorithms and balanced human oversi...
  • Dollar dominance challenged by Beijing’s golden yuan

    Outrageous Predictions

    Dollar dominance challenged by Beijing’s golden yuan

    Charu Chanana

    Chief Investment Strategist

    Beijing does an end-run around the US dollar, setting up a framework for settling trade in a neutral...
  • Dumb AI triggers trillion-dollar clean-up

    Outrageous Predictions

    Dumb AI triggers trillion-dollar clean-up

    Jacob Falkencrone

    Global Head of Investment Strategy

    Agentic AI systems are deployed across all sectors, and after a solid start, mistakes trigger a tril...
  • Quantum leap Q-Day arrives early, crashing crypto and destabilizing world finance

    Outrageous Predictions

    Quantum leap Q-Day arrives early, crashing crypto and destabilizing world finance

    Neil Wilson

    Investor Content Strategist

    A quantum computer cracks today’s digital security, bringing enough chaos with it that Bitcoin crash...
  • SpaceX announces an IPO, supercharging extraterrestrial markets

    Outrageous Predictions

    SpaceX announces an IPO, supercharging extraterrestrial markets

    John J. Hardy

    Global Head of Macro Strategy

    Financial markets go into orbit, to the moon and beyond as SpaceX expands rocket launches by orders-...
  • Taylor Swift-Kelce wedding spikes global growth

    Outrageous Predictions

    Taylor Swift-Kelce wedding spikes global growth

    John J. Hardy

    Global Head of Macro Strategy

    Next year’s most anticipated wedding inspires Gen Z to drop the doomscrolling and dial up the real w...
  • Executive Summary: Outrageous Predictions 2026

    Outrageous Predictions

    Executive Summary: Outrageous Predictions 2026

    Saxo Group

    Read Saxo's Outrageous Predictions for 2026, our latest batch of low probability, but high impact ev...
  • Despite concerns, U.S. 2026 mid-term elections proceed smoothly

    Outrageous Predictions

    Despite concerns, U.S. 2026 mid-term elections proceed smoothly

    John J. Hardy

    Global Head of Macro Strategy

    In spite of outstanding threats to the American democratic process, the US midterms come and go cord...

Disclaimer

The Saxo Group entities each provide execution-only service, and access to analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Inspiration Disclaimer and (v) Notices applying to Trade Inspiration, Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular, no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please refer to our full disclaimer and notification on non-independent investment research for more details.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Markets or its affiliates.

Saxo Markets
88 Market Street
CapitaSpring #31-01
Singapore 048948

Contact Saxo

Select region

Singapore
Singapore

Saxo Capital Markets Pte Ltd ('Saxo Markets') is a company authorised and regulated by the Monetary Authority of Singapore (MAS) [Co. Reg. No.: 200601141M ] and is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms & Risk Warning to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products such as Margin FX products may result in your losses exceeding your initial deposits. Saxo Markets does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Markets does not take into account an individual’s needs, objectives or financial situation.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-sg/about-us/awards.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website are not intended for residents of the United States, Malaysia and Japan. Please click here to view our full disclaimer.

This advertisement has not been reviewed by the Monetary Authority of Singapore.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.