The Memory Pioneer: Sanjay Mehrotra on SanDisk, Micron, and the AI Infrastructure Boom

Yes, great to be here with you.

Well, actually quite a few, you know, definitely quite a few. And, you know, we love to collect books when we visit places, so many of them are related to that, too. You know, there's a book on Gita, you know, that's like Hindu's holy scriptures. I think that's once in a while, you know, fun to look at some of the pages there, too.

Well, it was definitely quite an honor and privilege to represent Micron. And definitely it was fun. It was exciting and quite an experience. You know, took part in President Trump engaging with the CEOs on that morning that he was welcomed in Washington, D.C. And the CEOs that were there were also actually privileged to actually see him welcomed by President Xi. That was an exciting ceremony to watch. And you know, we took part in some of the bilateral dialogue. President Trump introduced the CEOs in the bilateral dialogue as well as the banquet at night. So, it was overall great to see U.S. and China coming together and, you know, building a relationship toward greater stability and that will be good for everybody.

Well, I mean, you know, as a business leader, definitely always looking for that environment, you know, that fosters innovation, you know, provides a platform for innovation benefit to all the businesses. And of course, stability and predictability and certainty around investments, as well.

No, I did not.

No, I did not.

You know, I've been in this industry now for 45-plus years, and this is the most exciting time for our industry. And I truly believe that the best is yet to come. Memory becoming such a key enabler for AI because, you know, today memory is not just about a component in devices like smartphones or PCs. Today, memory is absolutely enabling intelligence in artificial intelligence. Right? It's helping improve the intelligence. So, the opportunities for memory are tremendous, and of course, it's a very exciting time. And very proud of Micron's team as really the only US company that is in semiconductor memory manufacturing, really proud of the team that has worked hard over the decades, and so committed to advancements in memory technology roadmap, product roadmap to get to this point where memory has become absolutely center of the AI revolution. You know, I always considered Micron as a national treasure. And I think, you know, the world is seeing what a great national treasure Micron is, particularly in the midst of this AI revolution.

You know, I think it's all about the team and really has been wonderful to have worked with very many of these team members for a very long time. Certainly, you know, as I said, Micron national treasure, so very many strong leaders. When I joined Micron, I inherited them as part of my team. But other leaders as well that I've worked for very long time in the industry in my prior years at SanDisk. Combining the team together and that team that I truly consider among the very best in the semiconductor industry and having all the experience of being in our semiconductor industry for so long, I mean that really is the best asset that I personally have that helps me manage through, you know, all the opportunities and of course from time to time challenges in our industry and in our business.

Absolutely correct. I think the support that the family provides is critically important and, you know, absolutely my wife is really a pillar of strength and calmness and composure and, you know, in memory industry, semiconductor industry, you know, has gone through lots of ups and downs. So having that support system at home absolutely is a big advantage, big plus, no question about it.

Absolutely. I think, you know, without semiconductors there's no AI and memory is very much the backbone, a key enabler. And, you know, as I mentioned earlier, as models get larger, as inference continues to grow, you go from training to inference, you go from data center to edge, you just need more and more memory. More memory, more capacity, higher performance, lower power. These are all essential to realize the improvements in intelligence from one generation from one model to the next, from one inference application to the next. And now agentic AI, right? I think with agentic AI orchestration of AI, this has led to tremendous increase in demand for memory whether it is in a GPU platform or a TPU platform or it's an ASIC. You know, you need more and more memory. And so you have to look at the demand side that memory is a key enabler of intelligence in artificial intelligence. Intelligence is all about data. Data is all about memory. And when you look at token economics, I mean, that definitely relies on memory. And as the token usage grows with greater context windows, greater key value caching, and of course larger and larger models, it just requires not just compute, but it requires ability to remember, ability to have more memory, higher performance memory as well. So from a demand point of view, this is all still in very very early innings. We see that AI has long legs here. The other side is supply, Jody, that is very important to understand the full dynamics here, right? On the supply side, as is well known, supply is extremely short, and this is versus demand, and this is because high bandwidth memory, high performance memory, which is not just high bandwidth memory, you know, feature products like LP6, DRAM, all of them which are critical part of data center, as well as various edge devices, they all just required a lot of wafers, because as they get to higher performance, they are becoming bigger in die sizes, requiring more and more wafers. And all of this needs tremendous greenfield capacity. Construction of those fabs takes a long time. Equipping those fabs, qualifying the lines, bringing up the supply, which comes up in a gradual fashion, takes a long time, too. So you really have to look at both the demand side and the supply side, and the fundamentals have just changed for our industry in both of those regards.

So what I would tell you is again that this is early days of AI and more and more memory is going to be needed as AI as intelligence as agentic AI advances. On the other hand, supply is way short of demand. I cannot project when supply catches up with demand. We see supply being tight in the industry well beyond 2026 time frame. And again, you have to just look at the fundamentals. How does supply come up? Supply comes up through greenfield fabs. These fabs from shovel in the ground to getting first wafers out takes like 3 years, 4 years kind of time frame. And then you have to ramp up production as well. And of course, you know, that ramp up of production will always be done in line with the latest demand assessments as well. And other thing to point out is that technology is getting more and more difficult. That means each successive generation of technology is giving you less productivity in terms of gigabits gain that you have. All of this combination really bodes for demand and supply fundamental to stay healthy in the foreseeable future.

You know, certainly for 2022, you know, with chat GPT, I mean that absolutely changed the world and, you know, drove a tremendous inflection point in the demand environment. But even back in 2020 time frame, you know, we were absolutely when it was known that AI is starting to build momentum. We had frankly begun to talk about, you know, how memory is going to be at the heart of enabling AI. And even in 21 time frame, Micron was talking about that increases in supply will be needed because we could see that products like high bandwidth memory and their planned roadmap needed more and more silicon and high bandwidth memory back then was, you know, barely, you know, less than a single digit percent of 1% of the memory industry. So we could see that future generations of high bandwidth memory are going to require a lot of silicon and high bandwidth memory had a tremendous growth. And its impact on the supply dynamic and that's why we said green fields have to be built back even in 2021 time frame. But there is no doubt that nobody projected that AI will take off at this rapid pace of advancement and, you know, whether it is logic silicon or memory silicon nobody predicted that the need would grow this fast.

I think it was even in our December 2023 earnings call we had talked about that leading edge memory supply is going to start becoming tighter in 2024 certainly 2025. We saw that memory supply tightness only was growing and it was growing not just tightness for leading edge memory growing but even, you know, some of the long life cycle products such as DDR4 memory that go into applications like automotive, industrial, networking so across the board. So, we, you know, began to see some of these trends develop and we began to speak to it in late '23 and '24 time frame.

Yeah, but and, you know, as I said earlier, we began to plan our investments even in '21, '22 time frame, but of course, 2023 was a brutal year for the semiconductor industry and that's when some of the investments in new capacity were slowed down as well.

You know, I know that, you know, there are obviously concerns regarding jobs, you know, getting impacted with the AI. But I think the part that we all have to be really excited about and optimistic about is the innovation that AI enables, right? I mean, many of the problems that have been unsolved forever, you know, have opportunity to get solved and, you know, that when innovation happens, that creates tremendous new opportunity as well. And then when you also look at demographics, particularly in the developed countries, right? You know, that demographics, you know, populations are aging in the developed countries. So, productivity that AI provides, I believe, will absolutely be essential for the GDP growth rates to continue in the developed countries as well. And in terms of our responsibility, look, we have tremendous responsibility to our customers and of course to the team members at Micron as well. Over the course of last several years, we have been absolutely focused on driving a transformation at Micron itself in terms of making Micron a clear technology and product leader in memory and storage. I'm very pleased that through the hard work of our tens of thousands of team members, Micron has positioned itself today with the most comprehensive technology and product portfolio today. So, yes, I mean, that has been a big responsibility. And again, it's the team that enables it, that makes it happen, and I'm very proud of that team. In terms of responsibility to our customers, you know, who are of course planning on continuing to invest, you know, CapEx reaching trillion dollars, you know, in the coming few quarters, right? You know, that is of course a big responsibility to ensure that we continue to support their advances in AI because AI means revenue growth opportunities for them. It means innovation opportunities for our customers. So, yes, there the responsibility to continue to bring advanced technology products and supply that meets the requirements. This is a big responsibility and all our team is working very hard towards that.

You know, of course, you know, the societal issues of course have to be always considered and, you know, it has to provide benefit for the communities and for the broader populations. And I do believe that, you know, with advances that will come with AI, many of them that we may not even be able to imagine today and then the opportunities that it will eventually create, I think that will be, you know, ultimately good for the community. Of course, it does mean that yes, jobs will change, new jobs will get created, some jobs will get eliminated and that's why it's really, really important to embrace AI and leverage it, you know, to realize your own individual highest potential.

So, came from humble beginnings, came from a middle-class family in India. You know, I grew up in a home that didn't have a television, that didn't have a phone. And I think the first refrigerator we got in our home was maybe just about the time I became a teenager. So, humble beginnings and of course, you know, I could see my parents are always operating under tremendous constraints, but always very much focused on their children and particularly education for their children. So, I grew up in a home, you know, that definitely very much focused on family, family first, home where family values mattered a lot and home where my dad absolutely a man of tremendous conviction, force of nature and really the values he believed and he stood for them, no matter how hard things around him got in terms of living those values. I lived under a mom, you know, that was very calm, very composed. You know, as you can imagine, I mean, you know, coming from a modest, humble beginnings, I mean, our family did go through a lot of ups and downs and financial hardships as well and both my parents, you know, absolutely focused on the children. So, a home that also very much focused on education. I think education was always a priority for us.

I mean, for him it was very important that equality, for example, you know, men and women getting treated the same. Just keep in mind, I'm talking about 1960s. We are two brothers and two sisters and my dad would be saying in those times that he has four sons, not two sons and two daughters. And he sent my sister back in the 60s time frame in India to an engineering college and, you know, the family absolutely extended family was thinking that, you know, what is my dad doing that he's crazy. In those days, there used to be hardly any girls in engineering colleges in India. So, I think these are the kind of values that my dad absolutely stood for and as well as, you know, believing in what is right. You know, growing up in India, you know, in average society you could see corruption around you and he would absolutely never ever take part in it and would even if it meant hardship for him. And many times he ran into hardship, but he would never, you know, support any act of corruption.

I think, you know, success in the household was definitely making sure that, you know, family is together, family is respecting each other and caring for each other, staying connected. Success in the household was, you know, definitely again that there is respect for elders and, you know, respect for values that were important to the family. And then certainly success was for the children growing up was, you know, education.

Three of us engineers, fourth was not an engineer early on. She studied, you know, dietetics dietitian courses, but later transitioned to engineering. So, all four of us became engineers and practiced engineering. Yes.

Yeah, generally very serious student on the quieter side and but yes, there were times when did get in trouble, you know, for some of the mischiefs. I mean, you know, particularly in college, you know, in college in India because I did 2 years of college in India before transitioning to Berkeley here to finish my undergrad. But in very early years in college in India, I mean, if the professor was, you know, kind of boring. I mean, sometimes, you know, attendance was important. You know, you'll give your attendance, but then jump out of the window out of the classroom to then, you know, spare yourself from the torture of the class. I mean, so some of those things and, you know, did some of those kind of things along with friends. In India, sometimes it was the whole class will decide that they're going to cut the class and because attendance would be important. Attendance would be very important, but yes, I mean, teacher would be walking from one side and the whole class will be walking in the other direction. So, yes, I've had some of those funny crazy moments.

So, one of the most important events and I often have talked about it is when I had finished my 2 years of college in India. I was 18 years old. And my dad always had the dream to send me to the US for higher education. Didn't quite have financial means, didn't quite have a plan on how to support it, but he had the dream that he wants to send me to the US. Of course, my elder brother, who was already here, I must always be very thankful to him because, you know, he supported my dad's dream and, you know, said that okay, he will try to support me and remember, I mean he was I think at that time only about, you know, in his late 20s. And so, I went to US Embassy with admissions in hand from US universities and I got denied my visa three times and three different times. And when that happened, my dad didn't accept it and he said he wants to talk to the consul on duty who happened to be out for lunch. As he walked back in, you know, my dad essentially grabbed hold of him and I must say that he was very kind and lucky we were lucky that he let us into his office. And at that moment, you know, for about 20 minutes, you know, my dad essentially made a case for me. He was my father, he was my lawyer, he was my coach in that moment. He essentially made a very passionate case. 20 minutes of non-stop from my dad that why would the consul deny me the opportunity to come to the US that don't they realize that, you know, what a loss it would be for me, but he also said at that time that, you know, would you be denying a very strong student in your country at that time. And at the end of that 20 minutes, I mean the consul took the passport and he stamped the visa. And, you know, it was a performance of a lifetime for me to watch, right? And learn from. And it was at that moment that I learned that if you ever seek success, start with tenacity. My dad just did not give up. Of course, I also learned and have always appreciated that we were very lucky. I mean, suppose, you know, that consul had not walked in at that time and my dad was not able to get hold of him or if he didn't want to listen to him, could have easily, you know, walked him out. We were just lucky as well. So, I think tenacity and no question that luck do play an important role. You know, others that have really influenced my professor at Berkeley who absolutely coached me, guided me back in 1979 when I was looking for jobs and graduating with my masters. He guided me towards Intel where I joined team of George Perlegos who absolutely became a mentor for me. So, my professor was a mentor, George Perlegos at Intel. He was the golden boy of non-volatile memories at Intel Corporation. I learned a lot from him. You know, he really taught me back then in early '80s that engineering was not just about design engineering which is, you know, something I had studied for and I had started as a design engineer first in the industry. But that you had to focus on test and manufacturability, quality and that this was all the responsibility of engineers designing the chip. So, I learned that discipline very early on from him and I always thank him for coaching me to become a good engineer. And then Eli Harari, the lead founder at SanDisk, he absolutely helped me transition from an engineering manager or an engineer to a business leader. So, I mean, these my dad, my professor at Berkeley, my first boss in the industry, George Perlegos, who later became founder of Atmel Corporation as well, and Eli Harari, the lead founder of SanDisk, have absolutely shaped my career. And I would say that, you know, my wife plays a very, very important role in my journey because, you know, where I am today, this would not have been possible if actually she had not sacrificed her career to raise our daughters. She was well-respected, you know, accountant as well as controller in the tech industry, but in late '90s, in order to support the kids, you know, gave up her career. And, you know, that definitely helped me focus on my professional journey as well.

You know, certainly the background that you come from does shape who you are. It does shape your character and absolutely that does influence your leadership style as well. No question that, you know, very many of the Indians who are here in the tech ecosystem, you know, went through tremendous amount of competition to get to be able to get into the best schools in India as well as then schools here in the US. So, of course, you know, competition and thriving in competition absolutely deeply rooted because in India, 1.4 billion people, I mean, even in your school level, high school level, tremendous amount of competition. But also, you know, India, developing country, country of very many constraints in terms of resources. Many of us come from humble beginnings, you know, middle-class family background just like I described it to you for myself. And that learning, you know, how to operate within constraints, I believe ends up somehow being ingrained in us. I mean, seeing that in our childhood growing up as well as in terms of managing through, you know, all of the life, growing up, even going to colleges in India, operating under constraint, which when you think about it, that is such an important aspect for running a business, right? And, you know, the other part I would say is that India is a very, very diverse country. And so, you end up growing within lot of diversity, so you naturally learn to respect, to hear various points of views, and that ultimately helps as well. And, you know, lastly, I would say that think about, you know, us as students coming here to the country and giving up, you know, what we have had in our own upbringing there, and adjusting into a totally new environment, right? So, that adaptability that is needed, and that element of risk that is there in just going to a new country. Like when I came here and I went to Berkeley, I didn't know a single person. I didn't actually have even housing arranged, right? So, how you have to adapt at that point, how there is certain element of risk that you're taking. You are certainly stretching out of your comfort zone, you know, when you're coming to a foreign country and adjusting to a new education system as well as a cultural environment. It just brings about, I think, a cultural agility as well. So, I mean, all of those things, all of those attributes, when you think about it, it does help in running a business. And, you know, when you come here as a foreign student, you are definitely very much focused on gaining stability, establishing yourself. You're absolutely hungry as well. I think, you know, that again is something that's always helpful in the business, too.