Micron forecasts quarterly revenue above estimates on AI chip demand

Key facts

• Micron Technology forecasts first-quarter revenue between $60 billion and $63 billion.
• Analysts' average estimate for Micron's first-quarter revenue was $57.02 billion.
• Micron Technology's revenue quadrupled to $41.46 billion in the third quarter year-over-year.
• Micron Technology's adjusted earnings hit $25.11 per share in the third quarter.
• Micron Technology's gross margins reached 81 percent in the third quarter.
• Micron Technology's entire 2026 HBM supply is sold out under multi-year contracts.

Micron Technology forecast first-quarter revenue above analysts' estimates on Wednesday, signaling continued growth driven by strong demand for AI-powered memory chips. The company expects revenue between $60 billion and $63 billion, significantly exceeding the consensus estimate of $57.02 billion.

In its third quarter, Micron Technology delivered a blowout performance with revenue reaching $41.46 billion, more than quadrupling from $9.3 billion in the same period a year earlier. This beat Wall Street estimates of $35.84 billion. Adjusted earnings hit $25.11 per share, surpassing analyst expectations of $20.78, while GAAP net income soared from $1.88 billion to $28.2 billion year-over-year. The results sent shares climbing more than 13% initially.

The explosive growth is largely attributed to surging demand for high-bandwidth memory (HBM) chips, which are crucial for AI accelerators. Micron's CEO, Sanjay Mehrotra, stated that the company's entire 2026 HBM supply is already sold out under multi-year contracts, with Micron collecting $22 billion in customer prepayments. The company's next-generation HBM4 chips are ramping at twice the speed of the previous HBM3E generation, with HBM4 revenue already exceeding $1 billion. Gross margins reached an extraordinary 81 percent, up from 69 percent in the prior quarter and 27 percent a year earlier.