Meet ‘Memi,’ the $3 trillion memory boom powering small-caps, emerging markets, and Japan

Portfolio managers are calling it “memi”—a portmanteau of “memory” and “semiconductors” (known as “semis”)— and while it doesn’t have its own ticker, the sector is gorging itself on the $700 billion AI buildout. One of the bottlenecks large tech companies like Amazon, Google, Meta, and Microsoft face in the race to build data centers is in obtaining memory chips. Most of the supply comes from three monster memory-chip manufacturers: Micron Technology, South Korea’s SK Hynix, and Samsung, which are each now worth $1 trillion or more in market capitalization and climbing. 

The catch for investors however, is that memis are fueling growth in U.S. small-cap funds, international, and emerging market funds in all different corners of the market. So a portfolio that looks spread out and de-risked might be more exposed to memis than previously thought. And while the major memory players are enjoying a skyrocketing run, there could come a painful return to earth if big tech companies pull back on the cash they’re spending, which may already have begun given some of the recent corrections in tech stocks.  

Year-to-date, Micron’s stock is up 240%, and its market capitalization stands at $1.1 trillion; SK Hynix debuted on the Nasdaq this month after raising $26.5 billion in the largest U.S. listing ever by a foreign company; and Samsung is up 116% year-to-date on the Korea Exchange. 

The memi nickname came from asset manager Harbor Capital’s 2026 midyear outlook call with investors on Tuesday. Spenser Lerner, Harbor’s head of multi-asset solutions, confirmed the mashup between memory and semis was “very much intentional” because memory has become “the poster boy or poster person of the whole semis universe.”

“Within the AI beneficiaries, the semiconductors have just skyrocketed this year,” said Lerner. “Whether it’s memory or power, analog or compute, they’ve all performed really well at the expense of the Mag 7,” he said, referring to the so-called Magnificent 7 Big Tech companies Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla.

While most of the ink spilled on headlines about chips powering the AI boom is in relation to Nvidia, memory chips have carved out a new standout role. The prized Nvidia chips run AI models alongside workhorse memory chips called DRAM that store the data all the AI  models need to train. In its outlook report, Harbor said pricing for the DRAM chips has remained “firm,” and that a larger supply of memory chips is “unlikely to become meaningful before 2028.” That means the pricing power of the big three memis, Micron, SK Hynix, and Samsung, could last for the next two years. 

Micron CEO Sanjay Mehrotra called AI’s appetite for memory bandwidth “insatiable” at the company’s third quarter earnings call in June, and Micron has made a killing on scarcity pricing. The company reported total quarterly revenue of $41.5 billion, up 74% from the previous quarter and 346% year-over-year. Revenue from DRAM was a record $31.3 billion, up 343% year-over-year and made up 76% of its total revenue for the quarter. 

Roundhill Investments launched the first-ever memory ETF called DRAM in April with top holdings including Micron, SK Hynix, and Samsung. The ETF is less than a year old and its performance is 162% so far after it hit a peak in June of 180%. 

While memi may sound cute as a faux-sector name, the memory chip companies are having a real impact across the public equities market, linking parts of the market that don’t typically cavort together. Lerner noted that U.S. small-cap company stocks, emerging market stocks, and developed markets outside the U.S. all outperformed the U.S. market, with performance for all three tracing back to the same cluster of memory chip companies. 

Among emerging markets, the index returned 43.51% over the trailing one year, with most of the performance due to Korea’s Samsung and SK Hynix alongside Taiwan’s Taiwan Semiconductor Manufacturing Company. Lerner said most of the performance was derived from earnings growth rather than investors just paying higher prices. Korea and Taiwan now make up 51% of the index. 

Lerner pointed out the pattern in other places. In developed markets outside the U.S. that include companies in Europe, Australia, and the Far East, the relevant MSCI index returned 20.8% over the trailing year and most of it was due to Japan. MSCI’s Japan index returned 29.5% during the same period, and Lerner said the lion’s share of the developed market gain traced back to Japan’s chip-equipment makers and memory manufacturers including Tokyo Electron and Kioxia holdings, which was Toshiba’s memory business before it was spun out in 2017.

Even among small-cap stocks, AI exposure is driving gains, said Lerner. MSCI’s small-cap index posted returns of 30.2% during the trailing year, and its largest holding is Sandisk, which makes high-performance memory cards based on flash memory, a different type of memory.

“So much of what we’re seeing in the equity space this year is really described by where are the bottlenecks, where is the hyperscaler and neo-cloud cash flow going, and who are the beneficiaries of that,” said Lerner. “You can really describe a lot of equity performance this year from that.” 

Of course, the memory market is famously cyclical and subject to sharp boom-and-bust cycles, as manufacturers ramp up capacity to meet demand and eventually produce a glut of memory chips that drives prices back down. Today’s unprecedented investment in AI infrastructure, and the belief that ever-more powerful AI models will rewrite all the accepted rules of business, has led some bulls to argue that the memory market will finally break free of its boom-bust cycle.

That could make the “memis” sector more than a passing market fad. If history does repeat itself however, memi could eventually become…a memory.