Chipmaker posts record revenue and profits while long-term customer agreements reinforce confidence in the AI memory market
Micron Technology (MU) delivered a blockbuster fiscal third-quarter report, easing concerns about the artificial intelligence memory market and sending its shares sharply higher. The stock surged as much as 19% on Thursday, reaching a new intraday record high before trimming some gains.
The memory-chip maker reported record quarterly revenue of $41.5 billion and adjusted earnings of $25.11 per share, both exceeding Wall Street expectations. Gross margin reached an all-time high of 84.9%, the highest level in data dating back to 1990, highlighting the company’s exceptional pricing power as demand for AI memory continues to outpace supply.
The strong results came just days after semiconductor stocks experienced a sharp sell-off, fueled by concerns over AI spending and implementation. Micron’s earnings helped restore investor confidence, suggesting that demand for high-performance memory remains robust.
One of the report’s most significant highlights was the announcement of 16 long-term customer agreements designed to secure memory supply over multiple years. Fourteen of those contracts represent approximately $100 billion in minimum committed revenue and include take-or-pay provisions, ensuring customers purchase agreed-upon volumes or pay regardless. The agreements are also backed by roughly $22 billion in deposits and related commitments.
The contracts underscore how critical memory has become in AI infrastructure. High-bandwidth memory plays a vital role in powering AI servers, making it a strategic component rather than a commodity. For investors, Micron’s latest results reinforce the view that AI-driven demand remains strong and that memory suppliers are positioned to benefit from the industry’s continued expansion.
