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Micron stock jumps 9% as soaring prices from memory crunch lead to quadrupling of revenue
Customers committed $22 billion to secure future memory supply as AI-driven shortages lifted prices and pushed Micron’s revenue well above estimates.
- On Wednesday, Micron reported third-quarter revenue of $41.46 billion, beating estimates, and forecast fourth-quarter revenue of about $50 billion. The stock rose about 9% in extended trading.
- As the only manufacturer of high-end memory chips used in Nvidia's processors, Micron has seen demand far outstrip production capacity. This shortage forced large-scale data center customers to fund capacity to secure future supply.
- Micron signed 16 strategic customer agreements with $22 billion in take-or-pay commitments to lock in supply and protect margins. Remaining performance obligations for these agreements total around $100 billion.
- Daniel Newman, CEO of Futurum Group, said the AI build out has been underestimated and memory will command premium pricing. Jake Behan, head of capital markets at Direxion, cautioned that supply easing could skew bearish for Micron.
- Micron CEO Sanjay Mehrotra expects tight conditions to persist beyond calendar 2027 as the company plans fourth-quarter capital expenditure of around $10 billion. Separately, Hynix plans to raise up to $29.4 billion through a stock market listing.
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13 Articles
13 Articles
For the fourth quarter, Micron expects revenues of 50 billion dollars. Shareholders are relieved, but the focus is also on announcing the largest competitor.
·Düsseldorf, Germany
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Coverage Details
Total News Sources13
Leaning Left3Leaning Right3Center5Last UpdatedBias Distribution46% Center
Bias Distribution
- 46% of the sources are Center
46% Center
L 27%
C 46%
R 27%
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