On June 24, 2026, Micron Technology MU delivered another blockbuster quarter, reinforcing the strength of the AI memory cycle. The stock jumped 15% in after-hours trading following the announcement.
Record Quarter Crushes Expectations
Micron reported fiscal third-quarter results that comfortably beat Wall Street estimates. Revenues of $41.46 billion topped the Zacks Consensus Estimate of $36.52 billion. Adjusted EPS of $25.11 outperformed the Zacks Consensus Estimate of $20.98.
Revenues surged more than fourfold from $9.3 billion a year ago. Net income soared to $28.24 billion compared with $1.89 billion in the year-ago period.
Looking ahead, Micron projected fourth-quarter revenue of approximately $50 billion, far above the Zacks Consensus Estimate of $42.64 billion.
AI Demand Keeps Memory Markets Tight
The AI revolution continues to reshape the memory industry. Demand from data centers is consuming available production capacity, pushing up prices not only for high-performance AI memory but also for chips used in smartphones, laptops and automotive applications.
Supply shortages in memory and storage could take years to fully ease, even as industry capacity gradually improves through 2028, per management, as quoted on CNBC.
Perhaps the most significant development was Micron's announcement of 16 long-term customer agreements spanning three to five years.Thesecustomers include the likes of data center operators and automakers, per CNBC.
Sturdy Margins
Gross margin climbed to a record 84.9%, up from 74.9% in the previous quarter and just 39% a year earlier. The company expects margins to expand further to roughly 86% in the current quarter, as quoted on Yahoo Finance.
The numbers suggest that the memory market remains exceptionally tight rather than showing signs of weakening.
Data Center Business Leads the Charge
All four business segments delivered explosive growth, with data centers standing out as the primary driver.
Data center revenues jumped more than sevenfold to $11.5 billion from $1.53 billion a year earlier. Cloud memory revenues surged over 300% to $13.77 billion, while the mobile and client segment grew 250% to $11.52 billion. Automotive and embedded applications more than quadrupled, reaching $4.63 billion in sales.
AI Customers Are Securing Supply, Not Just Buying Chips
The broader takeaway for investors is that AI customers increasingly view memory as a strategic bottleneck rather than a commodity input.
Advanced AI systems require enormous amounts of high-speed memory. Micron's technology serves as a key component in chips produced by NVIDIA and Alphabet, as well as the servers that contain those processors.
As a result, customers are locking in long-term access to supply instead of relying on spot markets. The shift could help reduce Micron's historical earnings volatility and create a steadier growth profile.
ETFs in Focus
Against this backdrop, below we highlight a few ETFs that are heavy on Micron. While leveraged Micron ETFs include the likes of Direxion Daily MU Bull 2X ETF MUU and GraniteShares 2x Long MU Daily ETF MULL, these are risky bets.
AXS Knowledge Leaders ETF KNO, iShares MSCI USA Value Factor ETF VLUE, Strive U.S. Semiconductor ETF SHOC, Global X AI Semiconductor & Quantum ETF CHPX and First Trust Nasdaq Semiconductor ETF FTXL has considerable weight in MU shares.
Boost Your Portfolio with Our Top ETF Insights
Zacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.
Don’t miss out on this valuable resource. It’s free!
Get it now >>Micron Technology, Inc. (MU) : Free Stock Analysis Report
iShares MSCI USA Value Factor ETF (VLUE): ETF Research Reports
First Trust NASDAQ Semiconductor ETF (FTXL): ETF Research Reports
Strive U.S. Semiconductor ETF (SHOC): ETF Research Reports
Global X AI Semiconductor & Quantum ETF (CHPX): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
