Nvidia Growth Limited by Memory Bottleneck, Micron Poised to Benefit

Nvidia (NVDA) is often considered the poster child of the artificial intelligence explosion. However, as investors reevaluate NVDA stock and its tremendous gains, they'll also be considering what will support future growth, especially those enabling technologies like memory.

The primary driver for AI workloads, particularly large language models and inference at scale, is both compute and memory. High-bandwidth memory (HBM) has become the most significant bottleneck resource for getting data into GPUs for efficient use by the system.

Micron Technology (MU) is an important winner in this ongoing trend due to its position as one of only a small number of manufacturers that can produce high-bandwidth memory in sufficient quantities. The company's unique thesis is that it will have a higher growth rate than NVDA, even though its absolute revenue will remain lower.