Driven by a global shortage of memory chips, Micron Technology's stock has surged dramatically this week, with overall semiconductor sector optimism propelling its continuous ascent.

On Friday, Micron's stock price jumped over 15%, closing at $746.81. The stock has risen nearly 38% this week and approximately 84% over the past month.

This marks Micron's best weekly performance since December 2008, when its stock traded below $5 following the Great Recession. According to LSEG data, the company's market capitalization now exceeds $840 billion.

Micron is not the only chip stock performing exceptionally. AMD gained 26% this week, reaching a 52-week high on Friday, with a market cap surpassing $740 billion. Intel rose 25% this week and has more than doubled over the past month, with the CPU maker widely seen as staging a strong comeback.

Analysts at Bank of America and Evercore noted that capital expenditure from hyperscale cloud providers could exceed $1 trillion by the end of next year, with memory chip demand becoming a hallmark of the current AI infrastructure build-out phase.

While graphics processing units (GPUs) have previously been the focal point of AI hardware development, memory, storage, and CPUs are increasingly taking center stage.

Amid the memory chip shortage, memory manufacturers are seeing expanding selling prices and profit margins, while hyperscale cloud providers are complaining about rising costs for end-user goods and services.

DRAM and NAND are the two most in-demand types of memory. DRAM is faster but more demanding, while NAND, based on flash memory, is slightly slower but more reliable. Both are crucial for AI processing.

Multiple equity research reports indicate that Micron, Samsung, and SK Hynix collectively produce over 90% of the world's DRAM.

Like Micron, South Korean memory chip makers are also performing strongly. Samsung joined the trillion-dollar market cap club this week alongside companies such as Apple, Alphabet (Google's parent), and Microsoft.

Reports on Friday stated that SK Hynix is engaging with numerous global tech companies expressing investment interest in new dedicated memory production lines to boost output. The reports also mentioned that one proposal involves customer-financed equipment deals related to extreme ultraviolet lithography machines.

In a research note this week, Mizuho analyst Vijay Rakesh wrote, "Micron remains well-positioned in the memory space, with leading DRAM processes helping to reduce costs year-over-year, while in NAND, increasing layer counts can improve costs and enhance wafer capacity."

Researchers noted that over the past few months, Micron's overall share of retail trading has been rising. According to Vanda Research, net buying surged to a two-year high in mid-April. Vanda strategist Viraj Patel stated on Friday that although overall stock purchases by retail investors have been slightly weaker in recent months compared to past years, "it can be argued that Micron is capturing a larger share of retail fund flows and attention."