Micron Technology (MU) stock fell Wednesday despite issuing a stronger-than-expected outlook, underscoring just how high Wall Street’s bar has become after the memory-chip maker’s AI-fueled rally this year.
For its fiscal first quarter, Micron guided revenue to roughly $12.5 billion and adjusted earnings to $3.75 a share, both ahead of analyst averages of $11.9 billion and $3.05, respectively. Yet some forecasts were even more aggressive — as high as $13 billion in revenue — leaving some investors underwhelmed. The stock, which has nearly doubled in 2025 and outpaced most chip peers, dropped as much as 2.9% in New York trading. “The report and guidance were strong, but the company faced a very high bar,” wrote Vital Knowledge.
Still, the numbers reinforced Micron’s growing role in the AI supply chain. Its high-bandwidth memory (HBM) is critical to training large AI models and is now one of the company’s most profitable products. CEO Sanjay Mehrotra said Micron achieved record highs across its data-center business in fiscal 2025 and enters fiscal 2026 with “our most competitive portfolio to date.” As the only U.S.-based memory manufacturer, he said, Micron is uniquely positioned to capture the AI opportunity.
Fiscal fourth-quarter sales rose 46% to $11.3 billion, slightly above estimates, with adjusted earnings of $3.03 a share versus $2.84 expected. The company said memory-chip supply will stay tight into next year as data-center demand stretches capacity. AI adoption in PCs and smartphones is also beginning to pick up, according to Manish Bhatia, Micron’s head of global operations.
The chipmaker plans to boost capital spending after investing $13.8 billion in fiscal 2025. It has already secured price agreements for most of its HBM3e output through 2026 and is sampling the next generation, HBM4, which it expects to sell under fixed contracts to support more predictable revenue.
Micron and SK Hynix have been gaining ground on market leader Samsung Electronics by moving faster on the newest HBM technologies, which are used alongside Nvidia’s AI processors. The company’s bullish narrative gained momentum earlier this month when Citigroup raised its price target to $175, citing stronger-than-expected data-center demand.
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