Micron Forecast Tops Estimates as AI Memory Demand Stays Strong

Micron Technology delivered a stronger-than-expected fiscal first-quarter 2027 outlook, supported by robust demand for memory chips used in artificial intelligence infrastructure, although signs of slowing earnings growth and slightly weaker margins tempered investor enthusiasm.

Micron forecast first-quarter revenue of $61.5 billion, plus or minus $1.5 billion, well above Wall Street’s $56.77 billion consensus. Adjusted earnings are expected at $38.15 per share, plus or minus $1, compared with analysts’ estimate of $36.02.

The upbeat Micron earnings outlook reflects continued AI-driven demand across the company’s memory and storage portfolio. Revenue from server LPDDR SOCAMM products more than doubled sequentially during the fourth quarter, while Micron shipped PCIe Gen 5 and Gen 6 SSD products for AI-related cache applications.

However, growth is expected to moderate sequentially. Adjusted EPS increased 33% in the fourth quarter from the previous quarter, while Micron’s first-quarter guidance implies growth of about 14%. The company expects an adjusted gross margin of approximately 86.25%, slightly below the fourth quarter’s 87%.

Micron also expects adjusted operating expenses of roughly $2.06 billion in the first quarter and said operating expenses could increase by $2.5 billion during fiscal 2027.

For the fourth quarter, Micron reported adjusted earnings of $33.42 per diluted share, beating the $31.16 analyst estimate. Revenue reached $54.23 billion, topping expectations of $50.45 billion. Adjusted operating income climbed to $44.64 billion from $33.68 billion, while adjusted net income rose to $38.40 billion from $28.86 billion.

CEO Sanjay Mehrotra said Micron delivered record fiscal 2026 results and expects an “even stronger fiscal 2027,” citing AI demand and strategic customer agreements.

CFO Mark Murphy also said Micron intends to increase capital returns, with stronger shareholder distributions expected to begin from December 9.

Micron shares initially gained as much as 1% in after-hours trading before paring the advance, as investors weighed the strong AI outlook against margin pressure and expectations already reflected in the stock’s recent rally.