Performance cannot support "strong expectations"! Micron Technology's sharp drop after hours raises concerns about the "AI bubble"?

Zhitong Finance APP noted that after Micron Technology (MU.US) announced its performance, the sell-off once again reminded global investors of the inherent risks of betting on artificial intelligence chip manufacturers. Following the sharp drop of nearly $500 billion in the stock price of leading artificial intelligence chip manufacturer NVIDIA (NVDA.US) a few days ago, Micron's stock price fell by about 8% in after-hours trading, as the memory manufacturer's forecast provided earlier was lower than the highest expectations. Micron's news also triggered a decline in the stock prices of South Korea's two largest companies - Samsung Electronics and SK Hynix, both of which are suppliers of storage chips for the artificial intelligence supply chain, showing extreme volatility in stocks related to artificial intelligence. Micron is one of the many companies benefiting from the frenzy surrounding artificial intelligence-related stocks, as its high-bandwidth memory is used alongside NVIDIA's industry-leading chips for training large language models. In the year leading up to the report released on Wednesday, the company's stock price more than doubled, but even though the outlook roughly matched analysts' average expectations, the company was still penalized for not exceeding the high expectations. Andrew Jackson, Japan Stock Strategy Director at Ortus Advisors Pte in Singapore, said, "The market holds completely unrealistic expectations, as many stocks that far exceed market expectations are still being sold off." "But I think Wall Street is very clear that these U.S. stocks are being pushed too high. Too many paper investors are chasing quick profits." Earlier this week, the momentum of the global artificial intelligence boom was hit, with NVIDIA's stock price entering a correction zone on Monday before rebounding. The global index tracking semiconductor stocks has fallen by about 5% since hitting a historic high earlier this month. For companies like Micron, this means a high degree of uncertainty in stock prices, as its traditional output is memory for personal computers, smartphones, and more traditional data centers, which is still recovering from last year's slump. Tom Kang, Director at Counterpoint Research, stated that Micron's performance does not align with SK Hynix's earlier announcement that its HBM capacity will be almost sold out by 2025. He added that Micron lacks the dominant position enjoyed by SK Hynix in the AI memory field and also lacks the dominant position that Samsung holds in the broader memory industry. Kang said, "This poses a reality check for the artificial intelligence field, which still appears to have a bubble." Large-cap U.S. stocks seen as benefiting from artificial intelligence continue to rise, pushing their stock prices to historic highs. Micron Technology's stock price is 4.5 times the expected sales for the next 12 months, while the average price-earnings ratio for the past 10 years has been 2.2 times