Alphabet's quarterly earnings announcement on Wednesday evening sent memory semiconductor stocks sharply higher in premarket trading on Thursday.

Shares of Micron (MU) advanced 3.5% before the opening bell, while SK Hynix ADRs (SKHY) surged 6.7%. The rally followed Google parent Alphabet's decision to raise its projected 2026 capital expenditure to a range of $195 billion to $205 billion — a significant increase from the prior estimate of $180 billion to $190 billion.

Chief Financial Officer Anat Ashkenazi indicated the elevated spending reflects accelerated capacity deployment to satisfy customer requirements. The higher investment translates directly into increased demand for the semiconductor products both companies manufacture.

AI-focused servers depend heavily on high-bandwidth memory (HBM), which is designed to move large amounts of data quickly between processors and memory. HBM has become a key component in advanced AI infrastructure because training and running large models requires both high compute capacity and fast memory throughput. With Alphabet ramping up its infrastructure buildout, both Micron and SK Hynix are positioned as leading global HBM providers to capture significant demand.

The upward price movement is particularly notable given recent headwinds for both stocks. Micron has declined approximately 9% over the past month, while SK Hynix shares traded in Seoul have fallen nearly 25% during the same period, amid concerns that elevated chip pricing may prove unsustainable and that major technology companies might scale back capital outlays. Alphabet's Wednesday disclosure alleviated those concerns, at least temporarily, by showing that at least one of the largest cloud and AI infrastructure buyers is still planning higher capital spending.

ADR Supply Constraints Affect SK Hynix Trading

SK Hynix launched its U.S. listing on July 10 and has quickly encountered an unusual constraint. The company has already reached the 2.5% threshold for converting Seoul-listed shares into American Depositary Receipts, effectively halting additional supply from entering the U.S. market on a temporary basis.

When demand remains strong while available inventory is limited, price movements tend to accelerate. This dynamic partially explains why SK Hynix's 6.7% premarket gain exceeded Micron's advance. ADR supply limits can make U.S.-traded securities more sensitive to near-term order flow, even when the underlying company is also listed in its home market.

SK Hynix continues to make substantial manufacturing investments. Its board recently authorized a ₩7.09 trillion capital allocation for an advanced packaging plant in Cheongju. Advanced packaging is closely watched in AI semiconductors because it helps integrate memory and processing components more efficiently in high-performance systems. The company is scheduled to report Q2 financial results on July 29.

Tesla CEO Acknowledges Micron's Role

Micron drew additional attention from an unexpected source. During Tesla's quarterly earnings discussion, Elon Musk specifically acknowledged Micron for securing Tesla a substantial memory chip allocation at favorable pricing, while describing broader memory market pricing as "insane."

The remark underscored the extent of supply constraints across the sector. Companies are aggressively working to secure chip inventory, and Micron stands to benefit from both increased volumes and favorable pricing dynamics as it scales production of its latest memory technologies. Investors will be watching whether customer commentary from large technology and automotive buyers continues to confirm tight supply conditions in memory markets.

According to TipRanks analytics, Micron holds a Strong Buy consensus among analysts, with 29 Buy recommendations and one Hold rating issued within the last three months. The mean price target stands at $1,569.29, suggesting approximately 64% potential upside from current levels.