What Jim Cramer Sees in Memory Chip Stocks: Why Micron and Sandisk Could Still Climb

Semiconductor analyst Jim Cramer recently weighed in on two high-performing memory chip manufacturers that have already delivered remarkable returns. Since early 2023, Micron Technology (NASDAQ: MU) has gained 625%, while Sandisk (NASDAQ: SNDK) has surged 1,050% following its 2025 split from Western Digital. Despite these extraordinary moves, Jim Cramer believes both stocks possess additional upside potential—primarily due to a persistent bottleneck in production capacity that’s unlikely to ease in the near term.

The Memory Chip Supply Crunch That Jim Cramer Highlighted

The semiconductor industry faces significant capacity constraints driven by unprecedented demand for AI applications. According to Jim Cramer’s recent commentary, production equipment limitations represent the core constraint preventing chip manufacturers from scaling output quickly enough to meet exploding demand from data centers and AI infrastructure projects.

Micron’s CEO Sanjay Mehrotra echoed this sentiment during recent earnings calls, noting that customer AI buildout plans have driven sharp increases in demand forecasts for memory and storage. Industry observers expect aggregate supply to remain substantially below demand throughout the foreseeable future, which fundamentally supports the pricing environment for leading manufacturers.

Micron’s Market Share Gains in Critical AI Memory Technology

Micron operates across multiple high-demand memory segments, manufacturing DRAM products and NAND flash memory for personal computers, mobile devices, data centers, and automotive systems. Notably, Micron is not the market leader in either category but has been steadily gaining share against competitors Samsung and SK Hynix—a trend that Jim Cramer views favorably for sustained growth.

The company demonstrated particularly impressive momentum in high-bandwidth memory (HBM), a critical component for AI applications. Micron captured an additional 10 percentage points of HBM market share over the past year, substantially outpacing competitor gains. This position reflects strong demand from AI chip designers and hyperscale cloud providers.

Financially, Micron’s first quarter of fiscal 2026 (ended November 27, 2025) delivered results that exceeded expectations. Revenue climbed 20% to $13.6 billion, while non-GAAP gross margins expanded by 17 percentage points—a clear indicator of pricing power in a supply-constrained environment. Adjusted earnings jumped 167% to $4.78 per diluted share. Wall Street forecasts Micron’s earnings will expand at a 37% annual rate through fiscal 2029, which aligns with a current valuation of 32 times forward earnings—a level Jim Cramer considers reasonable given the growth trajectory and market dynamics.

Sandisk’s Position: Growth Potential vs. Current Valuation

Sandisk designs data storage devices using NAND flash technology, serving applications where performance and resilience matter more than cost. Unlike mechanical hard drives (slower but cheaper), NAND-based solid-state drives (SSDs) deliver the speed and durability that AI training and inference workflows require.

During the 12-month period through June 2025, Sandisk gained 2 percentage points of NAND market share according to Counterpoint Research—despite still ranking fifth industry-wide. Notably, major competitors including Samsung, SK Hynix, and Kioxia each lost at least 2 share points, while Micron was the only other notable gainer. This pattern suggests Sandisk is competing effectively for share in a consolidating market.

Sandisk’s Q1 fiscal 2026 results (ended October 3, 2025) also beat expectations. Revenue increased 23% to $2.3 billion, supported by strong growth in data center and edge computing segments. However, adjusted earnings declined 33% to $1.22 per share—though management projects earnings will nearly triple sequentially in Q2. Several hyperscale data center operators have begun testing Sandisk’s enterprise SSDs, with additional major customers planning trials this year.

Despite the operational momentum, Sandisk’s current valuation appears stretched by conventional metrics. At 170 times forward earnings against Wall Street’s projected 79% annual earnings growth through fiscal 2029, the stock commands a premium that reflects its recent 1,050% rally. While Jim Cramer acknowledges the company’s competitive positioning and growing market share, he suggests the stock’s extraordinary run may have created near-term risk.

What Investors Should Consider About These Semiconductor Plays

Jim Cramer’s assessment highlights a critical distinction between the two companies. Micron offers a more attractive risk-reward profile, combining genuine market share gains, reasonable valuation, and exposure to structural AI demand tailwinds. The combination of 37% projected annual earnings growth and a 32 times forward multiple provides room for continued appreciation while remaining grounded in fundamentals.

Sandisk presents a more nuanced case. The company is genuinely gaining market share in high-performance NAND flash, and multiple hyperscalers testing its products suggest competitive acceptance. However, investors should weigh that fundamental strength against a valuation that has already priced in substantial future growth following the stock’s extraordinary recent performance.

The underlying supply shortage that Jim Cramer emphasized—rooted in production capacity limits—remains the thesis supporting both investments. As long as chip demand from AI infrastructure continues outpacing manufacturing output, memory chip manufacturers should maintain favorable pricing dynamics. The key question for investors is whether current valuations already reflect this advantage, or whether additional upside remains available at these levels.