Micron Technology reported a 15-fold profit surge, with net income reaching $28.24 billion, or $24.67 per share, significantly exceeding analysts' expectations of less than $2 billion a year ago and $20.49 per share. Revenue quadrupled to $41.4 billion, surpassing the estimated $35.7 billion. This performance, driven by insatiable demand for memory chips essential for AI, led to a 16% jump in Micron's shares in premarket trading, pushing its market capitalization to $1.39 trillion and briefly surpassing Meta Platforms and Tesla.
The company's strong guidance included a forecast of approximately $50 billion in revenue for the current quarter and adjusted earnings of roughly $31 a share, indicating accelerating growth. Micron's CEO, Sanjay Mehrotra, stated there is "no line of sight" for AI memory supply to catch up with demand, expecting shortages to persist beyond 2027. This tight supply environment has given Micron and rivals like SK Hynix and Samsung Electronics significant pricing power, reflected in Micron's impressive gross margin of around 85% for the quarter, rivaling or exceeding larger tech names like Nvidia and Meta.
Analysts have reacted positively, with D.A. Davidson raising Micron's stock price target to a Wall Street high of $2,000, nearly double its previous close of $1,048.51, citing a "new era" for the company and a memory cycle that is "far from over." J.P. Morgan analysts noted the company's shift toward multi-year customer agreements is fundamentally transforming its business model and underpinning a more durable earnings profile. The demand for high-bandwidth memory (HBM) from hyperscalers like Amazon, Microsoft, Google, and Meta, who are investing hundreds of billions in data centers, is a key driver, with Micron's entire 2026 HBM output already sold out under fixed-price contracts.
The robust results from Micron have reignited the AI-driven rally across global chip stocks. Following Micron's report, other AI memory stocks, including SanDisk and SK Hynix, also saw significant gains, with each jumping around 13%. SK Hynix, a leader in the HBM market, is reportedly exploring a U.S. listing that could value the company at approximately $30 billion. Even AI-linked crypto miners like IREN and Cipher Digital experienced a boost, rising around 3%.
Micron also highlighted robotics as a significant long-term growth driver, comparing humanoid robots to L2+ autonomous vehicles to illustrate a potential tenfold increase in memory demand, signaling a sustained, multi-decade demand cycle starting later this decade. The company plans to increase capital spending to about $27 billion this fiscal year and anticipates a further jump in 2027 to meet the surging demand.
