Micron (MU) Stock Jumps 16% as Earnings Crush Every Estimate

TLDR

• Micron stock jumped about 16–19% in premarket trading after blowout fiscal Q3 earnings
• Revenue hit a record $41.46 billion, up from $9.30 billion a year ago; EPS of $25.11 beat the $20.49 estimate
• Q4 guidance of $49B–$51B revenue and $30–$32 EPS far exceeded Wall Street expectations
• Micron locked in 16 long-term supply deals worth approximately $100 billion in guaranteed revenue
• CEO said tight memory supply conditions are expected to persist beyond calendar year 2027

Micron Technology reported fiscal Q3 earnings on Tuesday that blew past Wall Street expectations, sending the stock up roughly 16% to $1,217 in premarket trading Wednesday. That puts it on track to close above its record high of $1,213.56 set on June 22.

Micron Technology, Inc., MU

Revenue for the quarter ending May 28 came in at a record $41.46 billion, up from $9.30 billion a year earlier and well ahead of the $35.69 billion consensus. Adjusted EPS of $25.11 topped the $20.49 estimate by a wide margin.

The company also posted a gross margin figure that turned heads. Management guided for 86% gross margin in Q4, well above the 81.9% Wall Street had penciled in.

For Q4, Micron guided revenue of $49 billion to $51 billion, versus analyst expectations of $43.24 billion. EPS guidance of $30.00 to $32.00 also came in well above the $25.31 consensus.

Raymond James analyst Melissa Fairbanks lifted her price target to $1,500 per share and simply said the firm is “running out of superlatives to describe performance.”

Supply Deals Lock In Long-Term Revenue

Perhaps the most eye-catching detail in the report was not a financial metric — it was a number: 16.

That’s how many long-term supply agreements Micron has now locked in, guaranteeing approximately $100 billion in revenue. The deals include either fixed prices or price ceilings close to current market levels, along with price floors.

Management said those floors will support gross margins “well above” any peak from a prior cycle. That directly addresses one of the key bear arguments — that current prices and margins are a short-term peak.

CEO Sanjay Mehrotra stated on the earnings call that tight supply conditions are expected to persist “beyond calendar 2027” due to AI-driven demand across all segments combined with structural supply constraints.

Deepwater Asset Management’s Gene Munster said the comments suggest “demand could outpace supply into late CY28 or even CY29.”

HBM and AI Hardware Drive the Margin Story

Micron highlighted strong momentum in its AI product lines. The company began high-volume shipments of HBM4 memory for a lead customer and is progressing on next-generation HBM4E products.

HBM, or high-bandwidth memory, is a key component in AI accelerator chips produced by Nvidia and used in data center infrastructure built by companies like Alphabet.

Direxion’s Jake Behan said HBM pricing power is what’s “resetting the earnings profile higher” and that strategic agreements lock in visibility beyond the next pricing cycle.

The stock has risen more than 700% over the past 12 months and crossed $1 trillion in market cap earlier this year.

Micron invested $7.1 billion in capital expenditures during the quarter and generated adjusted free cash flow of $18.3 billion. The board declared a quarterly dividend of $0.15 per share, payable July 21.

South Korean memory rivals also moved sharply on the news — SK Hynix gained 13% in local trading and Samsung Electronics rose 5.3%.

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