Micron serves up huge beat in fiscal Q3, shares surge afterhours
- Micron stock spiked afterhours as the company beat EPS consensus by 24%.
- Revenue in fiscal Q3 jumped 346% YoY.
- Micron expects $50 billion in revenue and gross margins of 86% in Q4.
- Operating cash flow more than doubles QoQ.
Micron Technology (MU) stock dashed higher in Wednesday's post-market as the leading memory-chip stock blew Wall Street projections out of the water for the fiscal third quarter that ended in May. At last check, shares had gained 15% afterhours.
Micron reported adjusted earnings per share (EPS) of $25.11, beating the analyst consensus by $4.83 or 24%.
Revenue of $41.46 billion came in $6.21 billion or 18% ahead of analyst estimates as well. Revenue surged 346% YoY as the stark supply crunch and heavy demand from the AI data center buildout in the memory chip industry led to a spike in prices.
“Micron’s record fiscal Q3 financial results and even stronger outlook for Q4 reflect the strategic value of memory in the AI era,” said CEO and Chairman Sanjay Mehrotra in a statement. “Micron is investing at record levels in technology, products and supply to address our customers’ rapidly growing demand. We believe our multi-year Strategic Customer Agreements will significantly enhance the durability and predictability of Micron’s strong financial performance.”
The earnings came on the back of operating cash flow of $25.39 billion versus $11.9 billion in fiscal Q2, the most recent quarter, and $4.61 billion in the same quarter one year ago.
Micron reported that pricing strength in its DRAM and HBM business pushed gross margins to 84.6% in Q3. SSD revenue also doubled QoQ to $5 billion, and the company said it is already running at a $100 billion per year AI run-rate.
"We expect tight conditions to persist beyond calendar 2027 as a result of AI-driven demand across all segments coupled with structural supply constraints," the company said in its quarterly release.
For the current fourth fiscal quarter ending in August, Micron said it expects revenue of around $50 billion and adjusted EPS of $31.00. It also projects gross margins of 86%.
Micron shares closed down 1.3% in Wednesday's regular session at $1,037.86 but climbed about 15% afterhours above $1,217.
Author
Clay Webster
FXStreet
Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.
