Micron Set to Report: AI Memory Boom Puts HBM in Focus as Stock Doubles Since April

Micron Technology heads into its fiscal third-quarter earnings report with the wind at its back. Since bottoming at $61 in April, the stock has doubled, driven by investor enthusiasm around the high-bandwidth memory (HBM) opportunity and signs of strengthening DRAM and NAND pricing. As the company prepares to report after the bell on June 25, expectations are running high for a solid print, fueled by robust AI-driven demand and optimism that memory markets have emerged from the worst of the downcycle. The upcoming report will not only serve as a litmus test for Micron’s ability to capitalize on the HBM boom, but also for the broader trajectory of the memory recovery cycle.

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For the third quarter of fiscal 2025, Micron previously guided revenue to a range of $8.78 billion to $8.82 billion, up approximately 9% sequentially and 56% year-over-year. Non-GAAP EPS was projected between $1.47 and $1.67, with gross margins expected at 36.5%. Street consensus now sits slightly above those levels at $8.83 billion in revenue and $1.59 EPS, implying a high bar has been set. Analysts are particularly focused on DRAM pricing, which several firms expect to rise at least 5% quarter-over-quarter, led by strength in HBM and datacenter demand.

Micron’s fiscal Q2 results, released in March, provide the base for comparison. The company posted revenue of $8.05 billion, up 38% year-over-year, with gross margin of 37.9%, and EPS of $0.42 on a GAAP basis and $1.36 non-GAAP. Compute and Networking Business Unit (CNBU) revenue more than doubled year-over-year, reaching $4.3 billion and accounting for over half of total revenue. Notably, HBM revenue surpassed $1 billion for the first time. Operating cash flow rose to $3.94 billion, giving the company the flexibility to aggressively invest in capacity expansion, particularly in the U.S.

A key narrative in the upcoming report is Micron’s leadership in HBM. The company has already sold out its 2025 HBM3E output and recently began sampling HBM4, which boasts 2TB/s bandwidth per stack and over 20% improved power efficiency compared to the prior generation. While HBM4 is a 2026 story, it affirms Micron’s technological roadmap and long-term relevance in AI-centric memory. Analysts believe HBM could drive $7–$9 billion in annual revenue by 2028, assuming Micron captures a 20–25% market share in a TAM expected to grow at a 60%+ CAGR.

Channel checks into the quarter have been broadly constructive. Stifel noted that DRAM and LPDDR5X demand held up well, with some PC and smartphone production pulled forward due to tariff timing. Wedbush pointed to a pickup in enterprise and server demand starting in April that appears sustainable through year-end. Citi, meanwhile, lifted its price target to $130 and sees upside from stronger-than-expected DRAM pricing. May contract pricing from inSpectrum showed DDR4 flat sequentially, while DDR5 rose 1.6% and NAND prices climbed over 3%—modest, but supportive of a firming market.

Still, risks remain. Gross margin is expected to dip slightly from Q2’s 37.9% to 36.5% as mix shifts more toward consumer and mobile applications, which are recovering but less profitable than datacenter sales. Meanwhile, despite strong demand, rising CAPEX has led to negative core free cash flow year-to-date—an issue partly offset by government incentives tied to U.S. investments. Micron is aggressively investing over $200 billion across Idaho, New York, and Virginia to build domestic DRAM capacity and HBM production, underscoring its commitment to vertical integration.

Investors should also watch how management frames Q4 expectations. Analysts are anticipating sequential revenue growth again, with Stifel looking for gross margins to improve by 200–300bps as higher-margin HBM3E volumes ramp. The street will be listening for updates on back-end capacity, HBM customer engagements (particularly with Nvidia and AMD), and any shifts in the competitive landscape as SK hynix and Samsung fight for HBM market share.

Another subplot to watch is the shift to a new segment reporting structure beginning in Q4. Micron will transition from its current business unit format to four reorganized divisions, which may offer better visibility into margin drivers across HBM, mobile, embedded, and storage markets. Until then, the CNBU remains the critical engine, delivering over 80% of Micron’s operating profit in H1.

From a macro perspective, the health of the broader memory cycle is central. DRAM ASPs have risen for three straight months, up 12% this month alone, according to PwC estimates. NAND bit shipments are projected to grow in the low double digits in calendar 2025, and while revenue comps are tougher in Q3, the structural improvements in Micron’s NAND technology—like its 232-layer 3D NAND—should help defend margins. The PC market recovery, Windows 10 end-of-life refresh cycle, and improving consumer confidence should all support further upside, albeit with some near-term margin dilution.

In summary, Micron enters its earnings report in a position of strength, buoyed by AI-led demand, a revitalized DRAM market, and clear leadership in HBM technology. Expectations are high, but so are the stakes. With the stock having doubled since April and buy ratings piling up, Micron’s Q3 results—and especially its Q4 guidance—will determine whether this rally has legs or if investors need to recalibrate in light of still-evolving macro dynamics. Either way, the company remains one of the most pivotal players in the semiconductor space as the memory market transitions from cyclical to structural AI-driven growth.