Micron Technology reported a remarkable fiscal third quarter, with revenue reaching $41.46 billion, significantly surpassing the $35.84 billion expected by analysts. This represents a dramatic increase from $9.3 billion a year earlier. The company's earnings per share (EPS) also exceeded expectations, coming in at $25.11 adjusted, compared to the anticipated $20.78.
The stock rose approximately 10% in after-hours trading following the announcement. For the upcoming quarter, Micron forecasts revenue of about $50 billion, well above the $43.58 billion consensus estimate. The surge in revenue is attributed to skyrocketing memory prices, largely driven by the demand for AI chips, which have consumed production capacity from memory vendors.
Micron's market cap has now surpassed $1 trillion, with its stock price increasing around 700% over the past year. The company anticipates that tight memory supply conditions will continue beyond 2027 due to sustained AI demand. Micron has secured 16 long-term agreements with various customers, ensuring sales stability for the next three to five years.
The gross margin improved significantly to 84.9%, up from 74.9% in the previous quarter and 39% a year ago, indicating strong profitability. Net income for the quarter was $28.24 billion, or $24.46 per share, compared to $1.89 billion, or $1.68 per share, in the same quarter last year.
Notably, the data center business saw sales increase more than sevenfold to $11.5 billion, while cloud memory revenue surged over 300% to $13.77 billion. The company also announced a 15 cent dividend for shareholders in July