Plenty of investors recently have piled into AI stocks without having much sense of the companies in which they're investing. What's particularly surprising about the AI revolution is that for the most part, you haven't yet seen new companies really emerge as the leaders of this new advance in technology. Instead, many of the same companies that powered past technological advances, such as the internet and even the personal computer, have stepped up to the plate to take their swing at the AI opportunity.
During the month of February, the Voyager Portfolio is investigating some of the most popular companies in the market to figure out what's behind their success. The technology industry is full of stories of founders getting off the ground in the most unusual of ways, but the story that Micron Technology (MU 3.15%) has followed is even more interesting than most. This first article in my three-part series on Micron will look more closely at how this maker of vital memory chips for AI hardware got to where it is today.
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Micron began its existence in the basement of a dental office in Boise, Idaho in 1978. The goal of its four co-founders was to make Micron into a successful semiconductor chip design business, and in a testament to the needs of the time, its first contract was to design a memory chip that would have a capacity of 64 kilobits. Micron proved successful with that task, and by 1981, it had built an entirely new semiconductor chip fabrication plant in Boise. Its 64K dynamic random access memory (DRAM) made it into some of the most popular computing equipment of the early PC era, including the Commodore 64 home computer.
Like many chipmakers, Micron spent the following years looking to make its chips smaller and more powerful. The company cracked the 1-megabit threshold in 1987, and its products quickly made their way into PCs and graphics cards. Micron also ventured into other types of memory, including video random access memory (RAM) and fast static RAM in 1988. Subsequent increases in capacity paved the way for more complex operating systems like Microsoft (MSFT 0.15%) Windows to take their place as staples in the PC industry.
Paving the way for AI
Many of the advances that have directly helped Micron become an industry leader in AI have been decades in the making. Double-data-rate and quad-data-rate architectures in 1999 and 2000 increased memory bandwidth. Pseudo-static RAM had lower power needs that helped make smartphones possible, while high-density server memory modules addressed the needs of data-intensive operations. NAND flash memory enabled chips to retain data even without constant power, and the evolution of solid-state drives helped to give users more choices in balancing the need for high-capacity data storage solutions against the ability to gain access to that data as quickly as possible.
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At this point, Micron has 60,000 patents to its name. That intellectual property is proving to be a valuable asset as the company moves forward in supplying the needs of AI hyperscalers and other customers. Moreover, Micron has expanded far beyond its Boise roots, with global manufacturing facilities that give the business worldwide scope.
Riding the waves of the memory-chip cycle
From its story of success, it might seem as though Micron's journey from humble start-up to global behemoth went quite smoothly. However, the path that Micron took was a lot choppier than its timeline might suggest. Navigating the inevitable ups and downs in demand for its memory chips was a necessary skill in finding long-term success. As you'll read in the next article in this three-part series on Micron, it took considerable tenacity to make the company into the budding AI leader it is today.
