TLDR
- Semiconductor stocks poised for more gains as manufacturing equipment shortages prevent rapid production scaling, says Jim Cramer
- Micron posted 7.76% gain Friday while CEO details accelerating AI memory demand and $200 billion domestic production spending plan
- Company’s new 600,000-square-foot New York plant breaks ground with CHIPS Act support but won’t produce for years
- Cramer highlights Western Digital, Seagate, and Sandisk as other beneficiaries of supply crunch only Nvidia foresaw
- Markets climb in 2026 with Dow up 3%, Nasdaq up 1.2% as investors overlook global political tensions
Semiconductor stocks have more upside according to CNBC’s Jim Cramer, who pointed to equipment shortages as the key driver. Companies can’t expand chip production quickly enough because the tools needed aren’t available.
Cramer made his case Friday as Micron stock jumped 7.76%. The memory chip maker is seeing strong demand for its artificial intelligence products. But getting the equipment to build more chips is the real challenge.
“We don’t have enough equipment to expand production of these chips, and we can’t put it together fast enough,” Cramer said during his segment. This supply constraint is pushing prices higher across the sector.
Micron CEO Sanjay Mehrotra confirmed the demand picture during a Friday morning interview. His company is responding with a $200 billion investment in new U.S. manufacturing capacity. The first facility broke ground Friday in upstate New York.
The 600,000-square-foot plant represents a major expansion. “AI driven-demand is accelerating. It is real. It is here, and we need more and more memory to address that demand,” Mehrotra explained on “Squawk on the Street.”
New Factories Won’t Help for Years
Federal funding through the CHIPS Act is enabling the construction. The program offers subsidies to semiconductor companies building domestic production facilities. But Cramer stressed that new capacity won’t arrive quickly.
Chip factories take years to complete. The equipment installation process alone requires extensive time. Cramer predicts prices will continue rising unless demand weakens before these plants come online.
Memory chip stocks beyond Micron are benefiting too. Cramer named Western Digital, Seagate, and Sandisk as companies seeing gains from the supply squeeze. All three have posted strong performance recently.
The shortage caught most of the industry unprepared. A year ago, excess inventory seemed like the bigger problem. That changed fast. According to Cramer, only one company anticipated the shift correctly.
Nvidia Saw Demand Surge Coming
“Only Nvidia really saw it coming. They teamed up with the best of the best, Taiwan Semiconductor, to make all the high-end chips that are needed,” Cramer said. The partnership positioned Nvidia to meet processor demand without bottlenecks.
Memory chips face tougher constraints. The manufacturing equipment for these components is particularly scarce. Micron’s massive investment underscores how serious the shortage has become.
The broader market is holding steady despite international tensions. The Dow Jones has gained 3% in 2026 so far. The Nasdaq is up 1.2%. The S&P 500 has also posted positive returns.
AscalonVI Capital’s Anthony Esposito told CNBC that geopolitical events aren’t moving markets anymore. He cited minimal market reactions to recent international conflicts. Europe’s Stoxx 600 has climbed almost 4% this year.
Asian markets are performing even better. The MSCI AC Asia Pacific Index hit fresh highs after gaining over 5% in 2026. Japan’s Nikkei 225 and South Korea’s Kospi both reached record territory.
A Supreme Court decision on tariff policies is pending. Mehrotra confirmed Friday that AI memory demand shows no signs of slowing down.
