The term “paradigm shift” is often casually applied to what may simply be rapid rotations between hot assets, the latest example being the AI-driven semiconductor boom.
Hyperscalers like Amazon (AMZ) and Google (GOOG) are spending big on data centers containing thousands of AI accelerators. These systems require huge amounts of high-bandwidth memory for processing and NAND flash memory for storage, reducing supply and driving up chip prices.
Micron Technology (MU) produces DRAM, NAND, and other memory products, while Sandisk (SNDK) specializes in NAND flash memory and solid-state storage. Micron was up about 700% year over year and Sandisk gained more than 4,000%. Both have subsequently retreated from their peaks, illustrating how quickly enthusiasm can reverse.
The enthusiasm created the largest US IPO of all time in SpaceX (SPCX), while SK Hynix (00060), a leading provider of high-bandwidth memory, raised $26.5 billion through the largest-ever public listing by a foreign company in the United States. Its ADRs initially rose, but subsequent volatility exposed the risks of buying on maximum optimism, with SK Hynix falling 15% during Asian market hours.
