Can Micron and Qualcomm earnings sustain the AI rally?

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Micron and Qualcomm’s earnings may boost the AI rally, but analysts say valuation concerns will likely limit how long it lasts.

Asian equities rose sharply after Micron reported strong earnings and forecasts, with customers committing US$22 billion for its memory chips, and after Qualcomm forecast US$15 billion in sales from its data centre business by 2029. Tech-heavy markets in Japan and South Korea jumped, with Japan’s Nikkei rising over 2 per cent and South Korea’s KOSPI gaining 5.5 per cent, while S&P 500 futures rose 0.5 per cent and Nasdaq futures jumped 1.8 per cent. Even with the positive momentum, analysts said worries that AI-related stock valuations have become stretched continue to weigh on sentiment.
What the earnings and forecasts actually signalled to markets
Micron’s outlook came with a major demand indicator: customers committed US$22 billion for its memory chips, which helped lift confidence around chip supply and spending tied to AI. Qualcomm’s guidance also added support, with an expectation of US$15 billion in data centre sales by 2029, reinforcing the view that AI infrastructure demand remains strong. These announcements arrived as markets were already sensitive to whether the AI rally could keep running after record highs.
How markets reacted immediately after the announcements
The initial response was broad and fast across Asia, with MSCI’s Asia-Pacific index outside Japan up 1.3 per cent in early trading. Japan’s Nikkei climbed more than 2 per cent, while South Korea’s KOSPI rose 5.5 per cent, reflecting a strong bid for tech exposure. US index futures also moved higher, with Nasdaq futures up 1.8 per cent, suggesting investors were willing to add risk following the chip-sector updates.
Why analysts remain cautious about a sustained AI-led rally
Analysts highlighted that Micron’s results provided a “massively needed shot in the arm” for tech stocks, but they also pointed to lingering concerns about stretched valuations for AI-related companies. One market analyst noted that while the data suggested broader cooling in positioning that could challenge tech’s momentum in the near term, valuation worries were still likely to affect sentiment. Another strategist said the earnings were positive but doubted whether euphoria would spread for long across the rest of the sector.
What would be needed to prove sustainability
The information available shows a clear near-term lift tied to chip earnings and forecasts, but it does not establish whether AI stock gains can persist once valuation concerns dominate trading. To sustain a rally over time, investors would typically need continued evidence beyond one-off results, including broader sector performance and how other major AI players are tracking. With the market described as volatile in recent sessions due to valuation pressure, the persistence of that theme is presented as the main constraint on durability.

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Can Micron and Qualcomm earnings sustain the AI rally?

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