Nvidia's AI Surge: Follow the HBM Money Trail

The semiconductor sector is often a labyrinth of supply chains, technical jargon, and cyclical whims. But right now, there's one metric cutting through the noise: HBM sales. And if you're betting on AI's future, you're ignoring Micron Technology's recent earnings at your peril.

Let's cut to the chase: Micron's Q2 2025 results aren't just good—they're a neon sign flashing “BUY NVIDIA.”

The HBM Gold Rush: Proof AI Isn't a Fad

Micron's High Bandwidth Memory (HBM) revenue jumped over 50% sequentially in Q2, hitting $2 billion—a full 20% of the company's total revenue. This isn't just about selling more memory chips. HBM is the lifeblood of AI's neural networks, and its growth is directly tied to one company: NVIDIA.

Why? Because NVIDIA's A100, H100, and upcoming Blackwell GPUs rely on HBM to handle the data deluge of AI training. Micron's surging HBM sales aren't just a side note—they're a leading indicator of GPU demand. And here's the kicker: Micron now supplies HBM to four major customers at scale, with NVIDIA likely the largest.

The data center segment? Revenue more than doubled year-over-year, with HBM contributing mightily. Let that sink in: AI infrastructure spending is on fire.

NVIDIA's Supply Chain Health = Your Investment's Safety Net

Investors often overlook the supply chain's role in tech stocks. But here's the cold, hard truth: If Micron's HBM factories are running at full throttle, NVIDIA's GPUs aren't just selling—they're selling out.

Micron's CFO explicitly called out HBM's role in NVIDIA's AI infrastructure, and with HBM3e shipments surging, there's no shortage of evidence. Even more telling? Micron's next-gen HBM4 is already in the pipeline for 2026—a clear signal they're doubling down on this AI-driven growth.

This isn't just about memory chips. HBM's higher pricing and margins mean Micron's profits are soaring—adjusted EPS hit $1.91, 19% above estimates. And with NVIDIA's GPUs commanding $100K+ apiece, the AI demand cycle is real, profitable, and expanding.

The Stock's Technicals: A Breakout Waiting to Happen

Now, let's talk about NVIDIA's chart. The stock just cleared its January 2025 high of $152.97, and it's eyeing a $153.13 resistance level. Break through that, and the next target isn't $200—it's $250, a 70% jump from current levels.

Analysts are already primed. Loop Capital just hiked its target to $250, while Bernstein and Oppenheimer see multi-year growth fueled by NVIDIA's 90% GPU market share in AI data centers. Even the skeptics are getting swept up: the average price target is now $172, but the bull case is screaming louder.

Risks? Sure. But This Cycle's Just Begun

Critics will cite Micron's warning about conventional DRAM oversupply or NVIDIA's lofty valuation (forward P/E of 45–57). Fair points, but here's the counter: AI isn't a fad. Enterprises are sinking billions into infrastructure—$20B from European governments alone—powered by NVIDIA's software and chips.

Yes, a dip is inevitable. But with Blackwell GPUs sold out, Saudi Arabia's $200B AI city, and Taiwan's cloud investments, this isn't a one-quarter wonder.

Cramer's Call: Buy the Dip, Aim for $200

Here's my advice: Dip buyers, step up. Use pullbacks below $140 as entry points—the stock's historical momentum around earnings (10.5% CAGR since 2020) is too strong to ignore. Set a stop-loss at $155 and aim for $200 by year-end.

And if you're on the sidelines? NVIDIA's AI dominance isn't just a stock story—it's a secular shift. Micron's HBM sales are the canary in the coal mine, and right now, it's singing “full speed ahead.”

The AI train isn't slowing down. Hop aboard—before it leaves the station.