Micron’s earnings quadrupled this year. New deals could push it even higher
Micron’s third-quarter earnings more than quadrupled last year’s haul, buoyed by a string of deals that Boise chipmaker expects to “fundamentally change” its business model, the company announced Wednesday.
Propelled by demand for artificial intelligence, Micron CEO Sanjay Mehrotra outlined an “exceptional” third quarter that saw the company’s revenue reach $41.5 billion, up from $9.3 billion a year ago. This quarter’s revenue is $17.6 billion more than last quarter, Chief Financial Officer Mark Murphy said, the largest sequential jump in company history.
That’s a record Micron has broken each of the last five quarters, Murphy said.
Next quarter, the company expects to round out the fiscal year with even higher revenue: $50 billion, plus or minus a billion, according to a company earnings report.
“AI has elevated the value of memory,” Mehrotra said in Wednesday’s earnings call. “Micron is collaborating closely with our customers and suppliers across technology, product, manufacturing and commercial teams in this tight industry environment.”
New deals ‘transform’ Micron’s business
The announcement surpassed Wall Street estimates and reversed a roller-coaster course for Micron’s stock. After falling some 10% in a broad sell-off of chip manufacturers on Tuesday, the announcement bounced the stock almost 14% in after-hours trading Wednesday.
In May, Micron’s market capitalization — the total value of its publicly traded stock — topped $1 trillion for the first time, making it just the 16th company in the world to reach that milestone.
And yet Micron’s 2026 run of high-bandwidth memory chips — a type of dynamic random-access memory used in complex, high-speed computing — is already sold out for the year, the company has said. Supply is likely to stay limited for the next several years, Mehrotra said Wednesday, even as the company’s first Boise plant comes online next year.
Locally, Micron is focused on expanding that capacity — as well as its Boise footprint — on the south end of town. Huge sums of both public and private investment helped bring it into being. In 2025, the company and the federal government announced a $200 billion investment plan, with $30 billion of it earmarked to build a second chip fabrication plant in Boise. Its initial $15 billion plant, which was announced on the heels of the federal Chips and Science Act in 2022, is expected to start production in 2027.
Facing that timeline, Micron is locking in customers now. This week, Mehrotra announced that the company had signed 16 “strategic customer agreements,” or “SCAs” with important clients, including data centers, consumer goods producers and automakers. These multi-year deals set which products and how much of each companies buy from Micron, guaranteeing revenue over the life of the contract.
Mehrotra expects these deals, which typically last three or five years, to bring in half of Micron’s revenue when completed, he said, ballasting the company against the big swings of the historically cyclical chip industry.
“Strategic customer agreements are ushering in an exciting era for Micron,” Mehrotra said. “We expect these SCAs to significantly enhance the durability and predictability of Micron’s strong financial performance, accelerating the transformation of our business model.”