© vzphotos / iStock Editorial via Getty Images
Micron Technology (NASDAQ:MU) is scheduled to release its fiscal first-quarter earnings today after the market closes, and Wall Street is expecting nothing short of spectacular. It follows on the heels of an already impressive year that saw shares surge 176% in 2025, making it the best-performing stock in the Nasdaq 100 index.
As the Q1 report will provide a critical update on demand for memory chips, particularly in AI applications, investors will be watching to see if it continues to drive this momentum. Analysts certainly think so, with consensus estimates predicting revenue of $12.9 billion, a 48% year-over-year increase, and adjusted earnings more than doubling to $3.94 per share.
Multiple analysts also raised their price targets to $300 per share or higher in recent weeks, so let’s see whether the memory chip maker can live up to these lofty expectations.
AI-Driven Demand Powers Bullish Outlook
The primary reason behind analyst optimism ahead of today’s earnings is Micron’s exposure to high-bandwidth memory (HBM), essential for artificial intelligence (AI) accelerators. The company has sold out its HBM capacity for 2025 and much of 2026, with commitments from major customers securing visibility. Analysts say that HBM3E production is ramping up as planned, contributing to higher margins due to the premium pricing it commands compared to standard DRAM.
The overall DRAM and NAND markets also show improving conditions, with spot prices rising significantly in recent months and contract pricing following suit. Industry supply discipline has helped tighten availability, supporting revenue growth across data center, mobile, and other segments. Micron’s fiscal 2025 results underscored this shift, with annual revenue reaching $37.4 billion, up nearly 49% year-over-year, and data center sales now representing more than half of total revenue.
Micron also made strategic moves to narrow its focus, such as announcing earlier this month that it would exit the lower-margin consumer products business under the Crucial brand by early 2026. This allows Micron to reallocate its capacity to higher-value AI and enterprise opportunities, aligning with analyst projections for continued bit growth in advanced nodes, such as one-gamma DRAM.
Confidence in a Multi-Year Cycle
Recent analyst actions underscore the bullish sentiment. Firms including Wedbush, Stifel, Susquehanna, and Needham all raised their price targets to $300 per share, emphasizing Micron’s accelerating gross margins, which could potentially hit 60% in coming quarters. Moreover, they see full-year earnings approaching $25 per share by 2027, with high-end estimates well over $30 a stub. Consensus ratings lean strongly toward a buy, with average one-year targets implying 29% upside from its current price.
The tight supply in HBM and DRAM, combined with no signs of a slowdown in AI infrastructure spending from hyperscalers, supports the belief that Micron will beat estimates and provide upbeat guidance again.
Micron’s capital expenditure plans, while increasing for advanced facilities, remain disciplined compared to previous memory cycles, as it aims to avoid the oversupply issues of the past. With a diversified manufacturing footprint minimizing geopolitical concerns, its position as a key supplier in the AI ecosystem positions it for sustained demand growth through at least 2027.
Key Takeaway
Micron Technology has a solid track record of beating Wall Street’s expectations, beating consensus EPS estimates in each of the last four quarters, including a 6% surprise in Q4. This history, paired with recent analyst revisions and rising memory prices, contributes to the market’s optimism.
While the stock is down almost 8% in the past week and 12% off its all-time high, shares are up over 3% in premarket trading this morning, reflecting investor anticipation of another strong report and upbeat guidance. Barring a collapse in demand — which currently shows no signs of happening — the structural shift toward data center and AI memory suggests its upward trajectory will continue. Buying Micron stock either before or after the earnings release is a smart move.