Micron Technology forecast first-quarter revenue of $61.5 billion on Wednesday, with a margin of plus or minus $1.5 billion, surpassing the average analyst estimate of $57.02 billion as strong demand for AI memory chips continues.
Supply commitments rise to $32 billion
Micron Chief Executive Sanjay Mehrotra said in prepared remarks that the company’s customers had increased their financial commitments under long-term supply agreements to $32 billion, up from the $22 billion the company reported in June. He said most of these commitments were in the form of cash deposits.
Chief Financial Officer Mark Murphy said Micron’s remaining commitments under the agreements, which are an indicator of contracted future revenue, had risen to about $150 billion, compared with approximately $100 billion reported by the company in the previous quarter.
“We expect fiscal 2027 to be another record year, with sequential revenue growth in every quarter,” Murphy said. Mehrotra also forecast that supply and demand conditions for memory and storage would become much tighter in fiscal 2027 and 2028 than in fiscal 2026.
Earnings forecast and fourth-quarter results
Micron expects adjusted earnings of $38.15 per share in the first quarter, with a margin of plus or minus $1, compared with analyst estimates of $35.40 per share.
Fourth-quarter revenue more than quadrupled to $54.23 billion, surpassing estimates of $51.07 billion, while adjusted earnings reached $33.42 per share, compared with analyst estimates of $31.61 per share.
Micron’s stock has more than tripled since the start of the year, helping the company join the group of companies with market capitalizations exceeding $1 trillion in May. The shares rose less than 1% in extended trading on Wednesday.
Capacity expansion through 2035
Mehrotra said Micron had signed agreements covering most of its 2027 high-bandwidth memory output and would raise capital spending in fiscal 2027 above previous plans to increase production capacity.
Demand exceeding production capacity prompted the company in July to raise its planned U.S. investment to more than $250 billion through 2035, as Amazon, Alphabet and other technology companies prepare to spend more than $730 billion on AI infrastructure this year.
Micron President and Chief Operating Officer Manish Bhatia said: “Certainly, memory is the main constraint on AI, compared with other areas being discussed, whether computational logic or the power needed for data centers. The data center has become the largest market for memory and storage.”
Bhatia added that new production capacity could come online “as quickly as possible,” whether because of diminishing returns from future technology transitions or for other reasons. Micron is expanding production capacity at nearly all of its sites around the world, including by building new facilities in Japan and the United States.
The company expects to produce its first silicon wafers at these facilities in mid-2027, but Bhatia said the plants would need several fiscal quarters to ramp up production and achieve a “meaningful impact on the market.”
The generative AI boom has made high-bandwidth memory an essential component of data centers, supporting demand for Micron, a major supplier to Nvidia. The company, headquartered in Boise, Idaho, competes with South Korea’s Samsung Electronics and SK Hynix in the high-bandwidth memory market.
