The numbers were undeniable. Micron Technology (NASDAQ: MU) posted fiscal Q4 revenue of $54.23 billion, crushing the Wall Street consensus of $51.07 billion. EPS came in at $33.42, topping the expected $31.61. That’s a 400% year-on-year jump in top-line revenue, driven almost entirely by the insatiable demand for AI infrastructure.
But the market didn’t cheer immediately. Shares flickered between gains and losses in extended trading. The culprit? A warning on gross margins. CFO Mark Murphy confirmed on the earnings call that the company is increasing incentive compensation for workers, which will squeeze margins slightly in the coming quarters. It’s a small dip in the bucket given the scale of the revenue explosion, but traders are watching the cost structure closely.
The engine behind this surge is DRAM. Revenue from Dynamic Random-Access Memory jumped 343% to $39.8 billion, accounting for 73% of total sales. CEO Sanjay Mehrotra emphasized that Micron is the only US-based manufacturer of high-bandwidth memory (HBM), a critical component for AI chips. The company isn’t resting on its laurels; it’s set to invest $250 billion to build two new HBM campuses in New York and Idaho, both coming online next year.
Forward guidance is equally aggressive. Micron projects Q1 revenue of $61.5 billion, well above the $56.8 billion average estimate. EPS is guided at $38.15, beating the $36.02 expectation. The stock has already ridden a 240% rally this year and a 540% surge over the last 12 months. The question now isn’t if Micron will grow, but how much margin it can protect while scaling up its massive HBM production footprint.