Micron Stock Surges on Record $41.5B Quarter as AI Memory Boom Locks In $100B in Contracts

Records shattered on every line

Micron Technology reported fiscal third-quarter 2026 revenue of $41.46 billion — more than four times the $9.3 billion posted a year earlier — crushing Wall Street's consensus estimate of $35.84 billion and sending shares up roughly 17% in Thursday trading to near $1,229cnbc +1. Non-GAAP earnings per share of $25.11 topped the $20.78 analyst estimate, while gross margin surged to a record 84.9%, up from 39% a year earliercnbc +1. Net income of $28.24 billion compared with $1.89 billion in the same period last yearcnbc.

Four business units, all at records

The data center segment led the way. Micron's Core Data Center Business Unit — home to its high-bandwidth memory chips for AI accelerators — posted $11.52 billion in revenue at an 87% gross margin, up from $1.53 billion at 38% a year agotechtimes. The Cloud Memory Business Unit added $13.77 billion, up from $3.39 billion, while data center SSD revenue exceeded $5 billion and more than doubled sequentiallycnbc +1. Even the Automotive and Embedded unit quadrupled to $4.63 billion as customers accelerated purchases ahead of expected supply constraintstechtimes.

Contracts designed to end 30 years of boom and bust

Alongside the headline numbers, Micron disclosed 16 long-term Strategic Customer Agreements — take-or-pay contracts with data center operators and automakers — of which 14 carry minimum cumulative revenue commitments of approximately $100 billion through 2030techtimes +1. The deals come with $22 billion in upfront cash deposits and are structured with pricing floors designed to guarantee margins above any level Micron has achieved in any prior cycletechtimes +1. When fully executed, Micron expects more than half of company revenue to fall under these agreementscnbc.

"Our customers are recognizing that supply shortages in memory and storage will take considerable time to improve, even as we expect industry supply to improve gradually in 2028," CEO Sanjay Mehrotra told analystscnbc. CFO Mark Murphy added: "We get visibility on our demand. It's committed volume that we can be confident about making our investments."cnbc TD Cowen analyst Krish Sankar, who raised his price target to $1,500 from $660, argued that "the role of memory in AI is structural, not cyclical."techtimes

A $50 billion quarter already in sight

Micron guided fiscal Q4 revenue to $49 billion to $51 billion, a midpoint that exceeded analyst projections of $43.58 billion by more than $6 billion and represents more than five times the $9.8 billion it posted in Q4 2025cnbc +1. Gross margin is expected to expand further to roughly 86%, with adjusted EPS guidance of $31.00 plus or minus $1.00investopedia +1. The broader memory complex moved sharply higher in response: SanDisk shares jumped 15% and Western Digital climbed 13% in Thursday trading as investors priced in the likelihood that long-term contracted demand could become the new industry standard247wallst.