WSJ Tech News Briefing: TNB Tech Minute Summary

Episode: TNB Tech Minute: Chipmaker Micron Rides AI Wave But Is Squeezed by Costs
Release Date: March 21, 2025
Host: Victoria Craig, The Wall Street Journal

The latest episode of WSJ Tech News Briefing delves into three significant developments in the tech industry: Micron Technology's financial performance amid the AI surge, Boeing's ambitious plans for a next-generation jet fighter, and Google's strategic acquisition of cybersecurity startup Wiz. Hosted by Victoria Craig, the episode provides insightful analysis and expert commentary on these pivotal stories shaping the technology landscape.

1. Micron Technology: Riding the AI Wave Amid Rising Costs

Timestamp: [00:31]

Victoria Craig opens the discussion with Micron Technology, highlighting the company's impressive revenue performance in the previous quarter. Micron reported better-than-expected revenues, driven primarily by a 50% surge in sales of its high bandwidth memory (HBM), a critical component for artificial intelligence systems utilized by major players like Nvidia.

"Chipmaker Micron is getting squeezed by the costs of producing critical components for the artificial intelligence boom," Craig notes, emphasizing the dual-edged nature of Micron's success. While sales are soaring thanks to the AI demand, Micron faces significant pressure on its gross margins—the profit retained after expenses. The company's margins fell short of Wall Street expectations, signaling challenges in maintaining profitability despite increased sales.

Craig further explains the implications for Micron's outlook: "Expectations for the current quarter also fell below projections, indicating that while demand remains strong, cost management is becoming increasingly crucial for Micron's financial health." This situation underscores the broader industry challenge of scaling production capabilities to meet AI-driven demand without disproportionately escalating costs.

2. Boeing's Next-Generation Jet Fighter: A Costly Innovation

Timestamp: [02:15]

Shifting focus to the defense sector, Craig reports that President Trump has selected Boeing to develop what could become the most expensive jet fighter ever constructed. Although the Pentagon has yet to release official cost estimates, expert opinions suggest the total investment could exceed $50 billion.

"The Air Force's head of war gaming last month said that new Boeing jets would be used alongside drones to fight wars in the future against highly capable adversaries," Craig states, highlighting the strategic importance of this initiative. The envisioned fighter jet is not just a traditional piloted aircraft but is designed to work in concert with advanced drones, integrating cutting-edge technologies such as sophisticated sensors and powerful engines.

Craig underscores the critical role of these developments in future military missions: "Piloted planes with sophisticated technology like sensors and engines, used alongside semi-autonomous drones, are crucial for future missions." This approach aims to create a versatile and technologically advanced fleet capable of addressing modern warfare's complexities, particularly in deterring military threats from nations like China.

3. Google’s $36 Billion Acquisition of Wiz: A Boon for Venture Capital

Timestamp: [04:10]

In the realm of technology acquisitions, Craig covers Google's monumental $36 billion purchase of cybersecurity startup Wiz. This deal is poised to transform a nearly $300 million investment by New York-based venture capital firm Index Ventures into an estimated $4 billion windfall.

"Google's blockbuster acquisition to buy cybersecurity startup Wiz could turn a nearly $300 million investment into a more than $4 billion windfall for New York venture capital firm Index Ventures," Craig explains, shedding light on the substantial returns venture capitalists can achieve from such high-profile exits. The Wall Street Journal's exclusive reporting reveals that Index Ventures is Wiz's largest outside investor, positioning them to reap significant rewards from this acquisition.

Craig contextualizes the deal within the broader venture capital landscape: "Investments like these were once a dime a dozen for venture firms, but companies have been less in a rush to go public, putting investors in a holding pattern to cash out if regulators give the deal their blessing." This acquisition not only provides a lucrative exit for early investors but also sets a precedent for future startup exits, especially as large tech companies like Google continue to acquire innovative startups to bolster their capabilities.

Craig concludes by highlighting investor sentiment: "Investors hope Google's $36 billion buy will pave the way for similar startup exits in the future," indicating a positive outlook for venture capital firms as strategic acquisitions become a viable path to substantial returns.

For a comprehensive exploration of these topics and more, tune into Monday's Tech News Briefing podcast. Stay informed with the latest developments and expert insights from The Wall Street Journal's technology team.