Stephanie Link
Chief Investment Strategist & Portfolio Manager at Hightower, Contributor to CNBC
Micron's pricing strength should last, with management saying memory and storage supply and demand will be much tighter through 2028 and guiding 2027 stronger than 2026. Revenue rose 379% year over year and EPS 1,002%, with cloud, core data center, mobile/client and auto all up triple digits or more. Customer agreements rose to 26 from 16 quarter over quarter. x.comÂ
Micron's demand is contracted, not an AI bubble. It has strategic agreements with 14 of 16 customers covering $100 billion of contracted revenue, backed by $22 billion of cash deposits to secure capacity. That is also positive for the rest of the AI food chain, including data centers, the grid and power companies. x.comÂ
Micron's surging memory revenue points to a supercycle. Its segment and NAND revenue charts show a sharp recent acceleration, while the stock tests its rising 30-week average. x.comÂ
Micron and SK hynix pricing in a memory shortage past 2030 extends the memory-cycle case beyond the Street's 2028 expectation. SK hynix's record quarter adds evidence: per Wall St Engine, revenue rose 328% to $78.9B, operating profit rose 632% to $62.8B, and operating margin hit 80%. Agentic and physical AI could add demand as they roll out. x.com x.comÂ
Micron's projections are set so high that even great years may not be enough to meet them. Samsung's Q3 results show the risk: revenue of $145.6B missed the $150.7B estimate, and operating profit of $80.2B missed $81.1B. x.comÂ
Micron's memory leadership remains intact because it is sold out into 2027. A red day does not change those fundamentals; anyone arguing it has topped must identify which part of demand breaks and when. x.comÂ
Micron could benefit if memory demand remains strong through 2029. Nvidia CEO Jensen Huang said he sees no sign of demand slowing by then and that "you can always use more." x.comÂ
Micron and Sandisk's current demand strength is already priced in. The market already knows today's demand is strong, after Micron said it "can't meet even half" of data center memory demand, per @PolymarketMoney. What matters is memory demand in 2028-2030 and beyond. x.comÂ
Micron's sold-out high-bandwidth memory through 2027+ and contracts already being signed for 2029-2030+ extend its earnings runway. At 5x forward earnings, it is cheaper than a year ago; its private Anthropic stake is about to be instantly rerated at Anthropic's IPO, and a new share buyback is expected to be announced Dec. 9. Micron could certainly gain 30% in three months. x.com x.comÂ
Demand for Micron's products is through the roof, making its revenue surge only the beginning as it heads into 2027. The attached eight-quarter chart puts Q4 FY26 revenue at $54.2 billion, and Micron's gross margin is cited at 86%. A $100 billion revenue quarter could arrive in the not-so-distant future; the stock is a good bet here. x.comÂ
Micron's own guidance suggests the memory recovery comes later than consensus thinks. Its CFO guided to rising margins through fiscal 2027 alongside a more moderate pace of price increases, and Micron said it has no line of sight to when supply and demand will return to balance. x.com x.comÂ
Sandisk's fast-growing data-center revenue strengthens its case among memory names with upside. Data-center revenue rose 61% quarter over quarter; revenue of $11.03B, adjusted EPS of $49.51 and adjusted gross margin of 85.1% all exceeded estimates. For upside among Micron, Sandisk and Kioxia, Micron ranks first, then Sandisk, then Kioxia, until further guidance. x.com x.comÂ
