Micron Technology shares jumped 13% in afternoon trading on Thursday after the memory chipmaker delivered a strong outlook, forecasting a sharp rise in revenue and earnings along with record-high margins for the current quarter. The upbeat guidance was driven by rising memory prices and surging demand linked to artificial intelligence workloads, which fueled record first-quarter results.
Morgan Stanley analyst Joseph Moore described the results as potentially the strongest revenue and net income upside ever seen in the U.S. semiconductor industry, excluding Nvidia.
For the quarter ended November 27, Micron reported non-GAAP earnings of $4.78 per share, well above the average analyst estimate of $3.94. Revenue climbed to $13.64 billion, up from $8.71 billion a year earlier and ahead of consensus expectations of $12.83 billion.
The company has benefited from a sharp recovery in traditional DRAM pricing, as well as increasing demand for high-performance memory used in generative AI applications.
Looking ahead to the second quarter of fiscal 2026, Micron forecast revenue of $18.7 billion, plus or minus $400 million. This significantly exceeds Wall Street estimates of $14.23 billion. The company also expects earnings per share of $8.42 at the midpoint, nearly double the consensus forecast of $4.49.
Micron said gross margins are expected to reach an all-time high of 68%, representing an increase of 11.2 percentage points from the previous quarter. Industry checks across the memory supply chain point to double-digit quarterly price increases for DRAM, Micron’s main profit driver, as customers grow more concerned about supply constraints extending into 2026.
“In fiscal Q1, Micron delivered record revenue and significant margin expansion across the company and in every business unit,” Chief Executive Sanjay Mehrotra said in a statement.
Mizuho analyst Vijay Rakesh highlighted Micron’s strong February-quarter outlook, noting continued upside driven by favorable pricing for high-bandwidth memory and advanced DRAM. He raised his price target on the stock to $290 from $270.
Micron expects its performance to continue improving through fiscal 2026 as it invests to support growing demand for memory and storage solutions used in AI systems. Stronger demand for high-bandwidth memory and advanced NAND has boosted pricing power, margins, and cash flow.
The company reported operating cash flow of $8.41 billion, up from $5.73 billion in the previous quarter and $3.24 billion a year earlier. Free cash flow also reached a record level.
