Micron Projects 12% Revenue Surge, Driven by AI Demand

Micron Technology, the leading computer storage chip manufacturer in the United States, has issued a bullish outlook for its first quarter of the 2026 fiscal year, driven by the surging demand for artificial intelligence (AI) devices. In its fourth-quarter earnings report, Micron projected first-quarter revenue of approximately 125 billion dollars, surpassing analysts' average expectation of 119 billion dollars. Excluding certain special items, earnings per share are anticipated to be around 3.75 dollars, exceeding the previous analyst forecast of 3.05 dollars.

This outlook underscores Micron's position as a major beneficiary of AI-related expenditures. Its high-bandwidth memory (HBM) is crucial for the chips and systems required to develop AI models, making this technology a highly profitable product for the company based in Boise, Idaho. The company reported a 46% increase in fourth-quarter sales, reaching 113 billion dollars, which exceeded analysts' expectations of 112 billion dollars. Excluding certain special items, earnings per share were 3.03 dollars, surpassing the average analyst prediction of 2.84 dollars.

The company's CEO highlighted that the data center business achieved a record high in the 2025 fiscal year. Entering the 2026 fiscal year, Micron is maintaining strong momentum with a highly competitive product portfolio. As the sole U.S.-based memory manufacturer, Micron is uniquely positioned to capitalize on future AI development opportunities.

Micron anticipates that the supply tightness for memory chips will persist into next year. The continuous growth in demand for data center equipment is making it challenging for related companies to meet order requirements. AI-related businesses are also driving demand for NAND flash memory, one of Micron's second-largest product lines.

Micron has warned investors that expenditures will increase to meet market demand. In the 2025 fiscal year, Micron invested 138 billion dollars in new factories and equipment, and it expects this year's investment to exceed that amount. The company has already secured pricing agreements for most of its HBM3e memory chips for 2026 and has begun supplying samples of the next-generation HBM4 chips. Micron plans to sell these products through fixed contracts, which will help ensure stable revenue.

Despite the challenges, Micron remains focused on improving profitability, prioritizing it over market share growth. The company noted that the demand for storage chips in the personal computer and mobile phone industries is also on the rise. These sectors, which had previously lagged behind data center operators in adopting AI technologies, are now catching up.

The manufacturing process for HBM is more complex compared to other types of chips, leading to longer equipment occupancy times in factories. This limitation on HBM's overall supply expansion helps maintain a healthy market balance. The storage chip market is known for its cyclical fluctuations between prosperity and decline, as well as significant price volatility.

Micron and its Korean competitor SK Hynix have made progress in competing with market leader Samsung Electronics. Both companies have quickly introduced the latest generation of HBM memory, which can closely collaborate with NVIDIA's AI processors. Micron's executives stated that the company's latest products, along with upcoming next-generation offerings, are helping it maintain a leading position.

Analysts are optimistic about Micron's growth potential in the data center market, further boosting market confidence in the company. On September 11, Micron's stock price experienced its largest single-day gain in four months. The company's strong performance and positive outlook have reinforced its position as a key player in the AI-driven storage chip market.