Key Stats for Micron Stock
- Pre-market Price Change for Micron stock: 10%
- $MU Share Price as of Dec. 17: $226
- 52-Week High: $265
- $MU Stock Price Target: $256
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What Happened?
Micron (MU) stock is up over 10% in pre-market trading after the memory chipmaker crushed fiscal first-quarter results and issued shockingly strong guidance for the current quarter.
The company reported adjusted earnings of $4.78 per share on revenue of $13.64 billion, easily topping Wall Street’s estimates of $3.96 per share and $12.88 billion in sales.
Micron expects revenue of about $18.70 billion—roughly $4.5 billion above consensus estimates of $14.20 billion. It also guided adjusted EPS to $8.42, nearly double the Street’s $4.78 expectation.
Overall revenue surged 57% year-over-year in the first quarter, while net income hit $5.24 billion, or $4.60 per share, compared to $1.87 billion, or $1.67 per share, in the year-ago period.
Gross margins reached a record 68%, reflecting strong pricing power and operational excellence.
CEO Sanjay Mehrotra told analysts that AI data center capacity growth is driving “a significant increase in demand for high-performance and high-capacity memory and storage.” He said server unit demand has strengthened significantly, with server units growing in the “high teens” during 2025.
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What the Market Is Telling Us About Micron Stock
The explosive guidance for Micron stock reflects a supply-demand imbalance that’s tilting heavily in the company’s favor.
Micron makes memory and solid-state storage for computers—semiconductors that have been in short supply in recent months as the AI infrastructure boom requires massive amounts of both kinds of chips.
On the analyst call, executives emphasized they’re completely sold out across DRAM, NAND, and high-bandwidth memory (HBM) for the foreseeable future.
Chief Business Officer Sumit Sadana said aggregate demand is “substantially higher than the ability to supply,” not just for Micron but across the entire industry. All segments are short on supply, and customers are unable to get what they need.
That extreme supply constraint is driving record margins and giving Micron pricing power. CFO Mark Murphy noted that demand from AI, combined with structural supply constraints and Micron’s technology leadership, has created a favorable environment.
He said margins can continue expanding from here, though the pace will be more gradual given the company is already at record levels.
Micron stock has been on a tear, up 175% year-to-date, and the latest results suggest that run isn’t over. The company reported $5.28 billion in cloud memory sales, which doubled year-over-year, while core data center sales hit $2.38 billion, up 4%. Both business units benefited from higher pricing.
Micron is one of just three companies that make the high-bandwidth memory needed for AI applications.
For example, Micron’s memory is used in large quantities in AMD’s latest AI chips. EVP Manish Bhatia said the company expects its HBM4 yield ramp to be faster than HBM3E 12-high, which was already quicker than HBM3E 8-high—showing Micron is gaining confidence in its HBM capability at scale.
The company is also doubling construction CapEx from fiscal 2025 to 2026 to build out capacity, including projects in Idaho, Japan, Singapore, and India.
But even with aggressive investment, supply won’t catch up to demand anytime soon. Micron generated nearly 30% free cash flow margin in the first quarter, paid down $2.7 billion in debt, bought back $300 million in shares, and reached net cash positive—all while investing heavily for growth.
Earlier this month, Micron said it would stop selling memory and other parts directly to consumers to preserve supply for AI chips and data centers. That decision underscores just how tight the market is.
For now, Micron stock looks positioned to keep benefiting from the AI-driven memory shortage, with record margins and a massive backlog that should support strong results well into fiscal 2026 and beyond.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
