TLDR
- Micron (MU) closed at $914.13 on Oct. 14, about 25% below its June 25 record close of $1,213.56.
- Fiscal Q4 revenue hit $54.2 billion and adjusted EPS came in at $33.42, both above guidance.
- Micron expects about $61.5 billion in Q1 fiscal 2027 revenue and adjusted EPS of about $38.
- Fears over China’s CXMT and slower DRAM price gains drove the drop.
- KeyBanc’s John Vinh reiterated a $1,750 price target, and Fundstrat called the sell-off an overreaction.
Micron Technology (MU) stock closed at $914.13 on Oct. 14. That is about 25% below its record close of $1,213.56 on June 25, and the lowest close since Aug. 24.
On Friday, the stock was down 1.6% at $916.75 in premarket trading. Even so, it has more than tripled so far this year.
The pullback has come as Micron’s results have kept improving. The company beat the outlook it gave in June, and management now sees tighter memory supply ahead.
For the quarter ended Sept. 3, Micron reported revenue of $54.2 billion. Adjusted earnings per share were $33.42. Management had guided to $50 billion in revenue, plus or minus $1 billion, and about $31 per share.
Growth has been quick. Revenue rose from $23.9 billion in fiscal Q2 to $41.5 billion in fiscal Q3, then to $54.2 billion in fiscal Q4.
What Management Said About Demand
For the first quarter of fiscal 2027, Micron expects revenue of about $61.5 billion. It sees adjusted earnings per share of about $38. That is roughly 23% above the forecast investors had when the stock hit its record.
CEO Sanjay Mehrotra said demand has strengthened since the prior call. He expects memory and storage conditions to be much tighter in fiscal 2027 and 2028 than in 2026.
Customers are backing that up with contracts. Revenue not yet recognized under multi-year supply deals rose from over $5 billion at the end of fiscal Q3 to about $134 billion at the end of fiscal Q4.
Still, the pace of price gains has cooled. DRAM prices rose by a high-teens percentage in fiscal Q4, down from a gain in the low 60s in fiscal Q3. CFO Mark Murphy said Micron expects “a more moderate rate of price increases” for the rest of fiscal 2027.
Spending is also climbing. Capital expenditures were about $27.4 billion in fiscal 2026, and Micron expects about $25 billion in the first half of fiscal 2027 alone.
Why the Stock Dropped
The latest leg down followed news from China. CXMT said on Oct. 10 that it plans to launch a new generation of server memory, built on a denser chip design, by the end of 2026.
Doubts about how long the AI boom will last have also weighed on the stock. Memory cycles often turn when new supply catches up with demand, so slower price gains and bigger building plans have caught some investors’ eyes.
Analysts see it differently. Kent Fung of Fundstrat said the CXMT news is “another reason to buy the memory dip.” He noted the design could challenge conventional server DRAM, but it does not compete with the high-bandwidth memory used in AI servers.
Fung also wrote that the reaction “has been a bit of an overreaction.” He said CXMT’s breakthrough has a weaker link to AI and to memory stock growth.
KeyBanc analyst John Vinh reiterated a $1,750 price target after a trip to check supply chains in Asia. He expects fourth-quarter DRAM pricing to rise 15% to 20% from the prior quarter.
Vinh also said Google is looking at extending long-term memory supply agreements through 2035. He does not expect the upcycle to last that long, but said it shows customers expect shortages beyond 2028.
On Friday, Micron stock was indicated lower in premarket trading at $916.75, still about 25% below its June peak.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
