- Lead. Micron Technology reported Q3 FY2026 revenue of $41.46 billion — a 346% year-on-year increase that crushed its own guidance of $33.5 billion and the Wall Street consensus of $35.59 billion — and guided Q4 to $50 billion, roughly $7 billion above analyst expectations.
- Fact. Gross margins expanded to 84.9% in the quarter, from 74.9% the prior quarter and just 39% a year earlier, as pricing power in high-bandwidth memory (HBM) chips used in AI accelerators proved more durable than many in the industry had projected.
- Stake. Micron’s guidance implies a memory market running structurally short of supply for AI applications through at least the end of 2026, a condition that ripples directly into the earnings power of Nvidia, SK Hynix, and other players in the AI hardware stack.
Micron reported its fiscal Q3 2026 results on June 24 in what CEO Sanjay Mehrotra described as a market defined by “AI memory demand that is outrunning supply by a wide margin,” according to CNBC. Revenue of $41.46 billion compared with the company’s own prior guidance of $33.5 billion and a $35.59 billion analyst consensus. Adjusted earnings per share came in at $25.11, against an estimate of $20.60 — itself already an expected 932% year-on-year improvement over the $1.91 EPS recorded in Q3 FY2025. HBM capacity, Mehrotra said, is “completely sold out through the end of 2026.”
The Margin Story
Gross margin of 84.9% is notable not just as an absolute level but for its trajectory: from 39% a year earlier, through 74.9% last quarter, to nearly 85% in Q3. The expansion reflects Micron’s shift in revenue mix toward HBM chips, which command pricing well above conventional DRAM or NAND flash, and its ability to pass cost increases through to AI datacenter customers who are themselves capacity-constrained. The level of margin being produced at scale suggests that Micron’s competitive position in the HBM supply chain has strengthened rather than normalised as the cycle has matured.
Q4 Guidance and Market Reaction
Micron’s Q4 revenue guidance of $50 billion (plus or minus $1 billion) represented the biggest single-quarter guidance beat relative to the prior consensus — roughly $7 billion above analyst estimates of $42.9 billion — that the company has ever delivered. Mehrotra cited visibility in AI infrastructure spending commitments from hyperscalers and flagged what he called “significant records again” in the coming quarter.
The stock surged approximately 15% in after-hours trading on June 24, pulling Nasdaq 100 futures up 1.8%. South Korea’s Kospi, which has been strongly correlated with the global semiconductor cycle, rallied as much as 6% on the news — a partial reversal following the sharp selloff that saw the index fall nearly 10% in a single session days earlier. Bank of America reiterated a $1,500 price target on Micron shares, citing “robust demand through 2028.” Micron’s market capitalisation had already crossed $1 trillion in May 2026, with the stock up more than 293% year-to-date before the Q3 print.