- Micron Technology (NASDAQ: MU) reported strong first-quarter financial results, with revenue of $13.64 billion and adjusted EPS of $4.78, significantly beating analyst estimates, driven by strong demand for AI-driven memory chips.
- The company issued upbeat second-quarter guidance, projecting adjusted EPS of $8.42 (give or take 20 cents) and revenue of $18.70 billion (give or take $400 million), nearly double Wall Street’s prior expectations amid tight supply from HBM.
- As one of the top three high-bandwidth memory (HBM) suppliers, Micron expects memory markets to remain constrained beyond 2026, plans to increase its 2026 capital spending to $20 billion, and is prioritizing production for AI data centers to capitalize on sustained demand growth.
Micron (NASDAQ: MU) has become a key player in the semiconductor memory industry, particularly through its leadership in high-bandwidth memory (HBM) chips that support advanced artificial intelligence applications. As one of only three dominant vendors alongside SK Hynix and Samsung Electronics, the company benefits from an oligopolistic market structure in which HBM is indispensable for training and deploying generative AI models in data centers.
The company’s first fiscal quarter results for 2026 demonstrated strong performance, with revenue reaching $13.64 billion, compared to $11.32 billion in the previous quarter and $8.71 billion in the same period last year. Adjusted earnings per share came in at $4.78, beating analysts’ expectations of $3.95, according to LSEG data. Operating cash flow reached $8.41 billion, compared to $5.73 billion sequentially and $3.24 billion year-over-year. CEO Sanjay Mehrotra highlighted record revenue and significantly increased margins across all business units, attributing this strength to technology leadership and operational execution to meet the growing needs for AI-driven memory and storage.
Looking ahead, Micron provided second-quarter guidance showing adjusted earnings per share of $8.42, plus or minus 20 cents, significantly higher than the Wall Street consensus of $4.78 per share. Revenue is projected at $18.70 billion, plus or minus $400 million, compared to the LSEG average estimate of $14.20 billion. Mehrotra noted that the outlook reflects substantial records in revenue, gross margin, earnings per share and free cash flow, with business performance expected to strengthen further through fiscal 2026.
Supply constraints remain a defining feature of the memory market, driven by growing demand from AI data centers operated by hyperscale cloud providers. Executives indicated that markets would likely remain tight beyond 2026, with Micron expecting to meet only half or two-thirds of demand from some key customers in the medium term. Sumit Sadana, Sales Director said Reuters that no customer is receiving the full requested volumes, and that many are receiving significantly less. This supply environment has motivated multi-year contract negotiations and resulted in an increase in planned capital spending for 2026 to $20 billion, up from the previously estimated $18 billion.
Analyst Kinngai Chan of Summit Glimpses highlighted that AI-related demand is the key growth driver, improving margins not only for AI-specific products, but also for non-AI segments, with supply prioritized over higher value-added applications. The company has been repositioning its manufacturing capacity toward AI data centers, including recently making the decision to end direct-to-consumer sales under the “Crucial” brand. eMarketer analyst Jacob Bourne observed that this strategic shift positions Micron favorably among suppliers capable of meeting the growing component requirements for AI infrastructure.
Micron’s chips underpin a wide range of applications, from servers and personal computers to smartphones and automotive systems, but the current boom is primarily fueled by data center expansion and tight supply dynamics in advanced memory technologies. With strong demand signals continuing and capacity investments underway, the company is well-positioned to capitalize on the continued expansion of AI-driven computing.
WallStreetPit does not provide investment advice. All rights reserved.
Disclaimer: This page contains affiliate links. If you choose to make a purchase after clicking on a link, we may receive a commission at no additional cost to you. Thank you for your support!