💾 Micron reported meteoric growth and nearly tripled revenue!
The company Micron Technology $MU posted results that show how strongly artificial intelligence can transform an entire industry. Revenue nearly tripled year-over-year and the firm significantly beat analysts' expectations.
📊 Results for the most recent quarter
Adjusted earnings per share: $12.20 (estimate $9.31)
Revenue: $23.86 billion (estimate $20.07 billion)
A year ago, revenue was about $8 billion.
📈 What is driving the growth?
The main driver is extreme demand for memory chips related to the artificial intelligence boom.
Each new generation of GPUs—especially from Nvidia—requires more memory, which creates supply pressure. The result is a combination of:
memory shortages (DRAM, NAND)
rising prices
significant margin improvement
The company's gross margin rose to as much as 74%, which is an exceptionally strong level in this segment.
📊 Outlook also well above expectations
Micron expects growth to continue in the coming period:
Revenue estimate: about $33.5 billion
EPS estimate: about $19.15
This significantly exceeds market consensus, confirming that demand for memory remains extremely strong.
📦 Where is the biggest growth?
cloud memory: +160% (to about $7.75 billion)
mobile and client segment: a significant jump from about $2.2 billion to $7.7 billion
At the same time, production capacity is shifting toward HBM (High Bandwidth Memory), which is key for AI chips and offers higher margins.
🏗️ Massive investments in capacity
Micron is responding to demand by aggressively expanding production:
The company announced new plants in Idaho and New York, involving investments in the tens of billions of dollars. Production start-up is expected in 2027–2028. Capital expenditures are set to increase significantly in the coming years.
📈 Stock performance
Micron shares are experiencing extraordinary growth:
Year 2025: more than +300%
Year-to-date: approximately +60%
After the results announcement they are currently down more than 4% in pre-market trading!
What is your view on Micron and its current valuation? Do you think the current growth is a long-term trend or just a cyclical phase?
In fiscal Q3, management expects revenue of about $33.5 billion, above the market estimate of $23.7 billion. The company expects earnings per share of around $19.1, above the estimate of $11.29. Micron expects a margin of about 81% in the following quarter. For comparison: (!fabless!) Nvidia operates with a gross margin of around 71%.
Management expects this massive demand to continue at least until the end of the decade.
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I kind of regret not buying Micron, but right now it seems more like a time to sell and take profits rather than buy.