About two weeks in the past, Superior Micro Units introduced the acquisition of MEXT, a start-up that has constructed synthetic intelligence (AI)-driven software program designed to make NAND flash behave like dynamic random-access reminiscence (DRAM).
The expertise makes use of predictive algorithms to establish incessantly accessed knowledge and transfer it between flash storage and high-speed reminiscence in actual time, decreasing the quantity of pricey DRAM a knowledge heart must run AI workloads at scale. In response to MEXT’s personal press launch, the software program can minimize reminiscence prices by practically half whereas increasing usable reminiscence capability by two to 4 occasions.
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For traders in Micron Expertise (NASDAQ: MU) and Sandisk (NASDAQ: SNDK), the knee-jerk learn is clear: If AMD can educate flash to behave like DRAM, demand for high-bandwidth reminiscence contracts declines. The knee-jerk learn is extremely flawed.
What MEXT truly does (and would not do)
MEXT’s expertise operates within the software program tier between current storage and compute. It would not exchange DRAM or HBM. As a substitute, it reduces the quantity of high-speed reminiscence sure workloads require by optimizing what lives in it at any given second. That is a significant effectivity achieve for enterprise clients operating general-purpose AI workloads, the place reminiscence is a value constraint.
What it can’t contact is the physics of coaching massive AI fashions and operating inference on the efficiency ranges that hyperscalers require. An Nvidia Blackwell graphics processing unit (GPU) calls for HBM4 not as a result of nobody has tried to work round it, however as a result of the bandwidth necessities of coaching trillion-parameter fashions are architectural constraints, not software program issues. No predictive tiering algorithm modifications what the silicon wants.
MEXT is a device for enterprises making an attempt to stretch current infrastructure. It isn’t an alternative choice to the reminiscence merchandise that Micron and Sandisk promote to large tech firms.
Picture supply: Getty Photos.
Micron’s place is structurally insulated
Micron Expertise’s total 2026 HBM4 manufacturing is offered out underneath binding multi-year contracts. At COMPUTEX 2026 in Could, the corporate laid out an end-to-end AI reminiscence portfolio spanning knowledge heart to clever edge, all in high-volume manufacturing. Fiscal first-quarter 2026 income hit $13.64 billion, up 57% 12 months over 12 months, with gross margins round 56%, pushed by HBM pricing energy that comes from contracted shortage.
The explanation Micron’s HBM enterprise is proof against MEXT is similar motive it is proof against most software-layer interventions: The shoppers shopping for it aren’t as price-sensitive as enterprise IT consumers. Hyperscalers constructing AI coaching clusters are optimizing for bandwidth and compute density, not TCO discount. That is a distinct purchaser with completely different priorities.
Sandisk is benefiting from the identical development AMD is concentrating on
Here is the counterintuitive half: MEXT’s expertise, which strikes knowledge between flash and DRAM, is determined by high-performance NAND flash to operate. The higher and sooner the flash tier, the simpler the tiering software program turns into. Sandisk is the corporate constructing the flash tier.
In third-quarter fiscal 2026, Sandisk’s knowledge heart phase income surged 233% sequentially to $1.47 billion, pushed by enterprise SSDs constructed particularly for AI workloads. Full-year income jumped 61% to $3.03 billion, beating Wall Avenue consensus by 12%.
Sandisk’s inventory is up roughly 750% 12 months thus far on the time of this writing, the best-performing large-cap expertise inventory within the S&P 500 up to now in 2026. AMD’s guess on reminiscence optimization software program is, at its core, a guess that NAND flash will soak up extra of the workloads historically dealt with by DRAM. That is a thesis that requires higher, sooner NAND — which is precisely what Sandisk makes.
So no, neither Micron nor Sandisk is underneath significant risk from the MEXT acquisition. The market made that clear at this time, with each shares flirting with 20% good points this week on June 25. The actual threat for each has at all times been the identical one which defines reminiscence investing: If AI infrastructure spending slows sooner than new capability comes on-line, pricing energy compresses, and margins comply with.
Each firms are going to be simply superb. AMD’s MEXT acquisition is a great transfer for its knowledge heart enterprise, but it surely would not change the elemental thesis for Micron or Sandisk. If something, it could be a tailwind.
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Micah Zimmerman has no place in any of the shares talked about. The Motley Idiot has positions in and recommends Superior Micro Units, Micron Expertise, and Nvidia. The Motley Idiot has a disclosure coverage.
