The $27 Billion Question: Can Micron’s Capacity Splurge Fend Off Burry’s Bear Thesis and SK Hynix’s Nasdaq Debut?

Record quarterly numbers. A stock that has tripled in 2025. And yet Micron Technology finds itself under siege from two directions at once. The US memory-chip maker closed Friday at €912.00, clawing back nearly 7% on the day, but the weekly tally still shows an 8% loss. That volatility has attracted a famous bear: Michael Burry of “The Big Short” fame has built a sizeable short position, betting that the AI-driven rally in Micron shares has inflated a bubble.

On the other side of the Pacific, a direct rival is preparing to challenge Micron on its home turf. South Korea’s SK Hynix, the current leader in high-bandwidth memory (HBM) chips, is set to list American Depositary Receipts on the Nasdaq as early as July 10. The timing could hardly be more awkward for Micron, which only last month posted blowout fiscal third-quarter results that smashed Wall Street estimates.

Revenue hit $41.46 billion, far above the roughly $36 billion that analysts had pencilled in, and adjusted earnings per share also cleared expectations. Yet the stock has slid more than 17% from its recent all-time high near €1,104 in late June. Insider selling and a fresh class-action lawsuit have added to the sour mood. Meanwhile, an announcement by Meta Platforms that it plans to launch its own AI service for third parties has fanned fears that the largest hyperscalers may be sitting on excess compute capacity, potentially cooling demand for the very chips Micron is ramping up to produce.

Burry, who runs hedge fund Scion Asset Management, entered his short near the €1,000 level. His thesis rests on a simple historical observation: over the past 42 years, Micron shares have suffered 34 drawdowns of more than 30%. The current correction from the 52-week peak has already begun to validate that caution, but Burry argues the stock is still dangerously extended. It has gained roughly 240% since the start of 2025 and now trades 133% above its 200-day moving average — a deviation he calls more extreme than anything seen during the dot-com era.

The fundamental battleground is the next generation of HBM chips, known as HBM4, which will power Nvidia’s upcoming Vera Rubin platform. Nvidia CEO Jensen Huang has confirmed that Micron is qualified for that platform — but so are Samsung and SK Hynix. Industry estimates put SK Hynix’s likely share of HBM4 supply at as much as 70%, with Samsung taking about a quarter and Micron left with a sliver. Official allocation numbers have not been released, and the fight for the subsequent “16-Hi” generation is only beginning, but a low market share would sharply reduce Micron’s pricing power.

Should investors sell immediately? Or is it worth buying Micron?

Bullish investors counter that Micron has fundamentally changed its business model. The company has moved from being a pure commodity supplier to a provider of specialised, customised memory products. Its HBM production capacity is entirely sold out through 2026, locked in by long-term contracts that remove the demand uncertainty that used to plague the cyclical memory industry. The Nvidia qualification ties Micron firmly into the highest-growth segment of AI hardware.

Beyond AI, a recent multi-year supply agreement with General Motors to equip future vehicle generations with various memory modules broadens its customer base and adds further visibility. Those fixed contracts helped support the stock on Friday, and chart watchers note that the 50-day moving average at €762.26 provides a solid floor.

Yet the bear case retains bite. Burry points out that Micron destroys shareholder capital in about one out of every three quarters; its free-cash-flow yield has been negative nearly half the time. If SK Hynix does dominate HBM4, Micron’s ability to command premium prices will erode quickly. Contracts for the next memory generation have not been signed, and internal negotiations over production volumes are still under way.

The company’s own response to the demand outlook is an astonishing capital-spending ramp. For fiscal 2026, Micron plans to invest $27 billion — nearly double the prior year’s level — and for the following year it targets over $40 billion. Management insists that capacity will remain tight even beyond 2027 and expects fiscal fourth-quarter revenue of roughly $50 billion.

Short-term catalysts are sparse. Shareholders must be on the register by July 6 to qualify for the next quarterly dividend. The more significant moment will come later this year when HBM4 deliveries begin in the third quarter of 2026. The market will watch closely how Nvidia ultimately divides the volumes among the three memory suppliers. For now, Micron’s stock hovers roughly 20% above its 50-day average, leaving plenty of room to fall if the bearish narrative gains further ground — or to surge if the sold-out order book starts converting into cash at the rate optimists expect.