Shares of Micron Technology rose 2% in premarket trading on Thursday after the U.S. chipmaker issued a strong revenue forecast for the fourth quarter, driven by surging demand for memory chips powering artificial intelligence data centers.

The company reported a nearly 50% increase in sales of high-bandwidth memory chips in the third quarter compared to the prior three-month period, underscoring its growing foothold in the AI hardware market. Micron is one of the few global suppliers of HBM chips, alongside South Korean rivals SK Hynix and Samsung Electronics.

Industry analysts attributed the chipmaker’s recent momentum to the rapid expansion of AI infrastructure.

“AI servers are giving Micron an over-caffeinated growth spurt,” said Michael Ashley Schulman, partner at Running Point Capital Advisors. “Micron is the only kid on the block shipping HBM3E at scale.”

The company confirmed that it will continue to invest heavily in HBM technology to meet the growing appetite from leading AI chipmakers such as Nvidia and Advanced Micro Devices, both of which count Micron as a supplier.

In a bullish note, analysts at J.P. Morgan projected that Micron’s HBM chip sales could soon reach an \$8 billion annualized revenue run rate within the next one to two quarters, reflecting expectations of accelerated growth in the sector.

Micron’s Chief Business Officer, Sumit Sadana, downplayed the impact of tariffs on recent performance, telling Reuters that tariff-related customer pull-ins in the third quarter were “fairly modest.” Analysts at Morgan Stanley echoed that sentiment, noting that while tariffs were acknowledged by management, they were not viewed as a primary factor behind the company’s recent strength.

Investor optimism was evident across the broader semiconductor space. Following Micron’s results, shares of peers Nvidia, AMD, and Marvell Technology rose between 1% and 3% in premarket trading. At least 10 brokerages raised their price targets on Micron stock.

So far this year, Micron’s stock is up more than 51%, significantly outperforming AMD and Nvidia, which have gained approximately 19% and 15% respectively. Micron currently trades at a 12-month forward price-to-earnings ratio of 11.85, compared to 6.48 for SK Hynix and 11.57 for Samsung.

The upbeat outlook and continued demand for AI-related hardware have reinforced investor confidence in Micron’s positioning within the rapidly evolving semiconductor landscape.