AI Memory Plays MU, SNDK, STX, WDC Jump Overnight: Nvidia Earnings Beat, Samsung Strike Pause Are The Catalysts

• MU stock rose 2.4% in overnight trading, leading the gains in U.S. memory stocks. 
• Nvidia reported a blowout first quarter and issued upbeat guidance, adding momentum to memory stocks.
• Samsung and SK Hynix shares rallied in Seoul and U.S. traders are eyeing the resultant move in the memory ETF, DRAM.  

U.S. memory chip stocks rose in overnight trading ahead of Thursday after Samsung Electronics and its workers said they had reached a tentative pay deal, averting a major strike at the Korean chip giant that risked disrupting the global supply chain.

Micron stock led the gains, rising 2.4%. SanDisk shares were up 2%, while Western Digital shares gained 1.4% and Seagate shares rose 1%. 

Momentum was also driven by a blowout quarterly report from AI chip giant Nvidia late Wednesday, which underscored robust AI data center demand. Sales of memory chips closely track AI server shipments, with data centers emerging as the largest revenue driver in the broader semiconductor space.

Samsung Strike On Pause

Samsung's union said on Thursday it would suspend its planned 18-day strike shortly before it was set to begin that same day, after workers reached a tentative pay deal with the company, Reuters reported. The union, which represents nearly 48,000 Samsung workers, said its members would weigh in on the deal offered by the company and vote on it May 22 and May 27, which means the risk remains until both votes pass.

In a separate statement, Samsung said the two parties had reached a tentative agreement on wages and collective bargaining and pledged to "build mature ⁠and constructive labor-management relations." The agreement comes after days of negotiations, which broke down several times, and the union confirmed plans to proceed with the strike on Wednesday.

According to Reuters, Samsung has accepted the union's demands to abolish the 50% cap on bonuses, to link bonuses to operating profits and to formalize the changes in contracts. In addition, the company would set aside about 10.5% of "agreed business ​performance" for special bonuses for the chip division, which houses its memory and logic chip businesses.

Samsung shares gained over 6% in Seoul, while those of its rival SK Hynix rose 11%.

Retail View On Memory Stocks

The development allays investor concerns for now. A prolonged disruption at Samsung would have destabilized the broader AI hardware supply chain, delayed shipments, and slowed data center buildouts — the latter being the key driver behind the recent surge in demand for memory chips.

“$DRAM $MU $SNDK $WDC Samsung strike called off. Can we get back to making Chips(money)?” said a trader on Stocktwits, expressing relief. Retail interest was particularly high in memory ETF, DRAM, tracking the sharp gains in Samsung and SK Hynix, which are its two biggest constituents. 

As of late Wednesday, the retail sentiment was ‘bullish’ for MU, and ‘bearish’ for SNDK, WDC, STX and DRAM.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: NVDA Stock Extends Fall Overnight Despite Handy Q1 Beat — AI Darling Still Sees Untapped $200B Opportunity