Micron Technology (MU), a major U.S. memory chipmaker, told its American customers that it will start adding extra charges on some of its products starting on Wednesday, according to Reuters. This is because President Trump’s new tariffs apply to memory modules and solid-state drives (SSDs), even though semiconductors are exempt. These parts are used in things like laptops, cars, and servers, and most of Micron’s manufacturing takes place in Asian countries like China, Taiwan, Japan, Malaysia, and Singapore.
Micron explained in a letter to customers that the new tariffs will raise costs, and the company will pass those extra costs on instead of covering them. It is worth noting that the firm had already mentioned this plan in a March 21 earnings call. Around the same time, Micron also told customers that prices were going up due to unexpectedly high demand. Other Asian tech manufacturers are taking a similar approach and are telling U.S. buyers that they will need to handle the tariff costs themselves or the products will not be shipped.
President Trump’s tariff policy has rattled global markets due to fears of a trade war and a possible recession. In addition, the U.S. started collecting a 10% tariff on many imported goods over the weekend. On Wednesday, even higher tariffs of between 11% and 50% will kick in, depending on the country. Now, companies around the world are deciding whether to eat those costs or pass them on to their customers, and most say that the new rates are too high to absorb on their own.
Is MU a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MU stock based on 21 Buys, three Hold, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average MU price target of $129.65 per share implies 84% upside potential.
