Micron’s first quarter results surpassed Wall Street’s expectations for both revenue and non-GAAP earnings, yet the market responded with caution. Management attributed the surge in performance to robust demand for memory products across data center, mobile, and automotive markets, all underpinned by rapid AI adoption and supply constraints. CEO Sanjay Mehrotra highlighted that “quarterly revenue nearly tripled versus one year ago,” driven by record highs in DRAM, NAND, and high-bandwidth memory (HBM) segments. Mehrotra also pointed to successful ramp-up of advanced manufacturing nodes and a step-up in technology leadership as key contributors. Despite these achievements, management acknowledged that price-sensitive consumer segments, such as PCs and smartphones, are experiencing some demand impacts due to higher pricing.
Is now the time to buy MU? Find out in our full research report (it’s free for active Edge members).
Micron (MU) Q1 CY2026 Highlights:
- Revenue: $23.86 billion vs analyst estimates of $19.87 billion (196% year-on-year growth, 20.1% beat)
- Adjusted EPS: $12.20 vs analyst estimates of $8.81 (38.4% beat)
- Adjusted EBITDA: $18.74 billion vs analyst estimates of $13.77 billion (78.5% margin, 36.1% beat)
- Revenue Guidance for Q2 CY2026 is $33.5 billion at the midpoint, above analyst estimates of $23.69 billion
- Adjusted EPS guidance for Q2 CY2026 is $19.15 at the midpoint, above analyst estimates of $11.33
- Operating Margin: 67.6%, up from 22% in the same quarter last year
- Inventory Days Outstanding: 123, down from 125 in the previous quarter
- Market Capitalization: $446.1 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Micron’s Q1 Earnings Call
- Krish Sankar (TD Cowen) asked about the sustainability of high gross margins as HBM4 ramps. CFO Mark Murphy emphasized the durability of current market tightness and AI-driven demand, but declined to provide margin guidance beyond the next quarter.
- Joseph Moore (Morgan Stanley) questioned demand allocation by end market, especially potential demand destruction in PCs and smartphones. CEO Sanjay Mehrotra confirmed supply remains tight, with key customers receiving only 50% to two-thirds of requested volumes, but maintained that diversified end-market exposure is a strategic priority.
- Timothy Michael Arcuri (Barclays) pressed for details on SCA terms and their ability to limit downside risk to margins. Mehrotra reiterated the confidential, robust nature of the agreements and their intent to provide long-term stability, but declined to reveal specific contractual mechanisms.
- Christopher James Muse (Cantor Fitzgerald) inquired about customer breadth for SCAs and whether non-hyperscale customers are participating. Mehrotra confirmed discussions are ongoing with multiple customers across various markets, stressing the strategic importance of these agreements for investment visibility.
- Vivek Arya (Bank of America Securities) asked whether Micron can achieve a 20–25% HBM market share in the upcoming cycle and how current margin levels compare to historical peaks. Mehrotra and Murphy highlighted strong HBM positioning and argued that secular AI demand and supply constraints differentiate the current cycle from previous ones.
Catalysts in Upcoming Quarters
In the upcoming quarters, the StockStory team will closely monitor (1) additional multi-year strategic customer agreements and their impact on revenue visibility, (2) the pace of ramp-up for advanced DRAM and NAND nodes, and (3) execution on global manufacturing expansions, particularly progress in new fab construction and equipment installation. The evolution of AI-driven end markets and further product mix shifts will also be key areas to watch.
Micron currently trades at $401.14, down from $461.73 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free).
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