Micron Technology, Inc. Q3 FY2025 earnings call

Micron's strong competitive position and solid execution delivered record revenue in fiscal Q3 with revenue, gross margin and EPS all exceeding the high end of our guidance ranges. Data center revenue more than doubled year-over-year and reached a record level, and consumer-oriented markets had strong sequential growth. Completed strategic reorganization of business units around key market segments. DRAM revenue reached new record driven by HBM revenue growth. In NAND, achieved new quarterly record for market share. Announced $200 billion investment plan in U.S. End markets outlook: data center, PC, mobile, automotive, industrial and consumer embedded markets discussed. HBM ramp and product development progress. SSD market share records.

Fiscal Q3 DRAM revenue was $7.1 billion, up 51% year-over-year and represented 76% of total revenue. Sequentially, DRAM revenue increased 15%. Fiscal Q3 NAND revenue was $2.2 billion, up 4% year-over-year and represented 23% of total revenue. Sequentially, NAND revenue increased 16%. Compute and Networking Business Unit revenue was $5.1 billion, up 11% sequentially and a quarterly record. Storage Business Unit revenue was $1.5 billion, up 4% sequentially. Mobile Business Unit revenue was $1.6 billion, up 45% sequentially. Embedded Business Unit revenue was $1.2 billion, up 20% sequentially

Expect revenue to grow by 15% sequentially to a record $10.7 billion at guidance midpoint in fiscal Q4. Gross margin to be in the range of 42%, plus or minus 100 basis points. Operating expenses for fiscal Q4 are projected to be approximately $1.2 billion. Expect fiscal Q4 tax rate to be around 13%. Based on share count, expect EPS to be $2.50 per share, plus or minus $0.15. Fiscal 2025 expected to deliver record revenue with solid profitability and free cash flow while investing in AI-driven memory demand.

D4 and LP4 products end of life may lead to shortages. Customer inventory levels may be affected by tariff-related pull-ins. Unforeseen demand changes due to macro conditions or evolving tariff-related situation.

Q: How you see the HBM TAM scaling with the accelerator TAM?

A: Sanjay Mehrotra said HBM demand grows, calendar '25 HBM revenue to $35B, '26 bit demand growth exceeds DRAM industry, HBM4 in '26, trajectory strong.

Q: What is driving the upside sequentially in gross margins?

A: Mark J. Murphy said better-than-expected pricing, strong volume growth, favorable mix from more DRAM and data center than consumer-oriented.