Micron earnings: AI chip demand drives fresh memory boom

Micron Technology delivered a blockbuster fiscal fourth quarter, with revenue and profit beating Wall Street expectations by a wide margin. The memory-chip maker also issued a stronger-than-expected outlook for the first quarter of fiscal 2027, pointing to continued demand from artificial intelligence data centres. (Sources: Reuters, MarketWatch, Yahoo Finance)

Micron reported fiscal fourth-quarter revenue of $54.23 billion, more than four times the $11.32 billion recorded a year earlier. Revenue also exceeded analysts’ expectations of around $51.5 billion, highlighting the strength of the current memory-chip cycle.

Micron reported adjusted earnings of $33.42 per share in the fourth quarter, compared with $3.03 per share a year earlier. The result also topped Wall Street expectations of about $31.83 per share, helped by stronger memory pricing, robust demand and a favourable product mix.

For the fiscal first quarter, Micron expects revenue of $61.5 billion, plus or minus $1.5 billion. That is well above analysts’ expectations of roughly $57 billion. The company also forecast adjusted earnings of $38.15 per share, plus or minus $1, compared with expectations of around $35.40.

Micron expects supply-demand conditions for memory and storage products to become significantly tighter in fiscal 2027 and 2028. AI data centres require large quantities of DRAM and high-bandwidth memory, while adding semiconductor production capacity can take several years.

Micron said the value of customer commitments under long-term supply agreements has increased to about $32 billion, up from $22 billion in June. Most of the additional commitments are backed by cash deposits, giving Micron greater visibility into future demand and revenue.

High-bandwidth memory has become a critical component of AI infrastructure because it allows advanced processors to access data much faster. Micron said it has already secured agreements covering most of its 2027 HBM output, underscoring the intense demand for memory used in AI systems.

Micron plans to increase fiscal 2027 capital spending as it works to expand production capacity. The company is developing manufacturing facilities in the United States and Japan, although new capacity will take time to come online. Some facilities are expected to begin initial wafer output from mid-2027.

Micron’s results highlight how the AI infrastructure boom is reshaping the memory industry. Rising demand for HBM and other advanced memory products is tightening supply, supporting pricing and encouraging chipmakers to invest heavily in additional capacity.

Micron expects fiscal 2027 to be another record year, with revenue growing sequentially through the year. Fiscal 2026 revenue reached $133.19 billion, compared with $37.38 billion a year earlier, reflecting the extraordinary acceleration in demand across the AI-driven memory market.
(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)