Micron Technology, Inc. Q1 FY2026 earnings call

• Micron had an outstanding start to fiscal 2026 with revenue, gross margin, and EPS above guidance. Achieved records in total company revenue, DRAM and NAND revenue, HBM and data center revenue, and business unit revenues. • HBM TAM is forecasted to have a CAGR of ~40% through 2028, reaching $100 billion by 2028, two years earlier than prior outlook. • Technology ramps: 1-gamma DRAM node ramping well, G9 NAND node ramping with robust yields. QLC NAND mix reached a record high. • AI integration: Over 80% of professional workforce uses GenAI; AI used in manufacturing, coding, R&D, and business functions to improve efficiency. • Market segments: Strong demand in data center due to AI build-out; PC unit sales forecasted to grow in high single digits in 2025; mobile DRAM innovation with LPDDR6 sampling; auto and industrial markets seeing robust demand with LPDDR5X and UFS 4.1 NAND products in demand. • Manufacturing investments: Increasing CapEx to $20B in fiscal 2026, accelerating fab timelines in Idaho and New York, making progress in Japan and Singapore, and initiating pilot production in India.

Total fiscal Q1 revenue was $13.6 billion. DRAM revenue was a record $10.8 billion, up 69% year over year, representing 79% of total revenue. NAND revenue was a record $2.7 billion, up 22% year over year, representing 20% of total revenue. Cloud Memory Business Unit (CMBU) revenue was a record $5.3 billion, 39% of total company revenue. Core Data Center Business Unit (CDBU) revenue was a record $2.4 billion, 17% of total company revenue. Mobile and Client Business Unit (MCBU) revenue was a record $4.3 billion, 31% of total company revenue. Automotive and Embedded Business Unit (AEBU) revenue was a record $1.7 billion, 13% of total company revenue.

• Fiscal Q2 revenue expected to be a record $18.7 billion, plus or minus $400 million; gross margin in range of 68%, plus or minus 100 basis points; EPS expected to be a record $8.42 per share, plus or minus $0.20. • Fiscal 2026 CapEx projected to be approximately $20 billion, weighted to the second half. • HBM TAM CAGR of ~40% through 2028, with $100 billion TAM by 2028, two years earlier than prior outlook. • Server unit growth in 2025 expected in high teens, continuing in 2026.

• Tight market conditions due to sustained strong industry demand and supply constraints, expected to persist beyond 2026. • Potential impacts of new tariffs not included in guidance. • Dependence on successful ramps of new technology nodes and managing mix of HBM and non-HBM products in a tight supply environment.

Q: Timothy Arcuri from UBS asked about customer LTAs and CapEx.

A: Sanjay Mehrotra mentioned multiyear contracts with specific commitments, different from prior LTAs; Mark Murphy discussed CapEx increase to $20B in fiscal 2026, disciplined CapEx growth.

Q: CJ Muse from Cantor Fitzgerald asked about CapEx intensity.

A: Mark Murphy stated they are being judicious with adding capacity, working to be efficient with capital spend, and ramping nodes to support supply.

Q: Harlan Sur from JPMorgan asked about HBM order book and SSDs.

A: Sanjay Mehrotra mentioned mix of HBM3E and HBM4 in 2026; Micron has strong enterprise SSD momentum with share gains.

Q: Thomas O'Malley from Barclays asked about HBM share and contribution.

A: Sanjay Mehrotra expressed confidence in competitive position, HBM4 being industry-leading; Mark Murphy noted product is well-positioned.

Q: Krish Sankar from TD Cowen asked about gross margin sustainability.

A: Mark Murphy said gross margins expected to expand beyond Q2 but more gradually; Sanjay Mehrotra discussed managing mix of HBM and non-HBM.

Q: Chris Danely from Citi asked about long-term contracts and HBM pricing.

A: Sanjay Mehrotra mentioned constructive dialogues with customers on long-term contracts; HBM for 2026 is sold out in volume and pricing.

Q: Vivek Arya from Bank of America Securities asked about memory price impact on demand.

A: Sanjay Mehrotra said some consumer markets may have mix adjustments, but AI drives increased memory requirement across devices.