Earnings report blows expectations, Wall Street intensively raises Micron's target price!

```

Micron Technology delivered its strongest quarterly report of the current fiscal year so far, with revenue, profit, and gross margin all significantly exceeding market expectations. The company also provided next quarter guidance that was notably higher than consensus, further boosting outlooks for the memory industry.

Following the earnings release, Wall Street institutions immediately started a wave of intensive target price upgrades. BofA Securities raised its target price from $1,500 to $1,550, maintaining a "Buy" rating; investment bank Baird sharply raised its target from $500 to $1,280; financial institution DA Davidson also increased its target to $2,000 (the highest target on Wall Street), maintaining a "Buy" rating; Goldman Sachs lifted its price target from $900 to $1,100, keeping a "Neutral" rating.

Goldman further pointed out that with DRAM and NAND prices continuing to climb, this quarter's financial report confirms the memory industry is still in an accelerated upcycle. The market's attention will next focus on management's updates on the progress of 16 strategic customer agreements, FY2027 capital expenditure plans, and additional guidance on changes in traditional memory demand structure.

Results Easily Beat Expectations, NAND Stands Out

For the third fiscal quarter ending May 2026, Micron’s three core metrics significantly outperformed market expectations.

The company reported revenue of $41.456 billion, a substantial year-on-year increase, about 14% above consensus. By business segment, DRAM revenue was $31.328 billion, about 11% above market expectations; NAND revenue was $9.943 billion, 27.9% higher than expected, making it the biggest source of outperformance this quarter.

Driven by both price and shipment volume, DA Davidson noted that NAND bit shipments grew mid-single digits quarter-on-quarter, while average selling prices jumped into the "low 80% range;" DRAM average selling prices also rose in the "low 60% range" quarter-on-quarter, indicating a clear strengthening memory price trend.

Profitability also far exceeded expectations. Non-GAAP EPS was $25.11, about 19% higher than market consensus; the gross margin reached 84.9%, about 240 basis points above consensus. Citigroup, citing FactSet data (including stock compensation), pointed out that revenue, gross margin, and EPS all significantly beat consensus estimates.

Next Quarter Guidance Raised Again: Demand and Pricing Strengthen Together

Micron’s guidance for the fourth quarter further reinforces the industry’s uptrend.

The company expects revenue in the range of $49 to $51 billion, with a midpoint of $50 billion, roughly 14% above consensus, representing about 20% sequential growth. Gross margin guidance rises to 86%, more than 100 basis points above market expectations. Non-GAAP EPS guidance is $30 to $32, with a midpoint of $31, also about 20% above consensus.

Citigroup data shows the guidance is significantly higher than their own estimates (revenue $42 billion, gross margin 82%, EPS $24.27), and also well above the FactSet consensus. Goldman notes that, importantly, the guidance does not show narrowing outperformance, indicating the memory price upcycle is still continuing.

Strategic Customer Agreements Lock in Long-Term Demand, Capital Expenditures Also Accelerate

On the demand side, Micron signed 16 long-term strategic agreements this quarter with customers in data centers, consumer electronics, and automotive, with an average term of about five years, covering approximately 20% of DRAM shipments and one-third of NAND shipments.

Most of these agreements use a take-or-pay structure, setting price floors and ceilings based on current market prices. The company disclosed that the minimum pricing clauses for these agreements correspond to about $100 billion in potential revenue and expects to receive about $22 billion in cash prepayments, to support supply chain expansion.

At the same time, the company expects fourth-quarter capital expenditures to reach $10 billion to fund capacity expansion, emphasizing that the tight supply-demand situation in memory is likely to last at least through 2027.

Risk Warning and DisclaimerThe market has risks, and investments should be made cautiously. This article does not constitute personal investment advice and does not consider the particular investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific situation. You are solely responsible for any investment decisions made based on this information. ```