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1. Company Snapshot

1.a. Company Description

Micron Technology, Inc.designs, manufactures, and sells memory and storage products worldwide.The company operates through four segments: Compute and Networking Business Unit, Mobile Business Unit, Storage Business Unit, and Embedded Business Unit.


It provides memory and storage technologies comprises DRAM products, which are dynamic random access memory semiconductor devices with low latency that provide high-speed data retrieval; NAND products that are non-volatile and re-writeable semiconductor storage devices; and NOR memory products, which are non-volatile re-writable semiconductor memory devices that provide fast read speeds under the Micron and Crucial brands, as well as through private labels.The company offers memory products for the cloud server, enterprise, client, graphics, and networking markets, as well as for smartphone and other mobile-device markets; SSDs and component-level solutions for the enterprise and cloud, client, and consumer storage markets; other discrete storage products in component and wafers; and memory and storage products for the automotive, industrial, and consumer markets.It markets its products through its direct sales force, independent sales representatives, distributors, and retailers; and web-based customer direct sales channel, as well as through channel and distribution partners.


Micron Technology, Inc.was founded in 1978 and is headquartered in Boise, Idaho.

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1.b. Last Insights on MU

Micron Technology's recent performance was driven by strong fiscal Q4 results, with 46% revenue growth and significant margin expansion, fueled by AI and data center demand. Robust guidance for the upcoming quarter and optimistic AI-driven demand outlook further bolstered market confidence. Analyst upgrades, including Morgan Stanley's price target increase to $338, also contributed to the positive momentum. Additionally, the company's solid fundamentals, efficient operations, and leadership in advanced memory technologies for AI infrastructure support its growth prospects.

1.c. Company Highlights

2. Micron Technology's Record Revenue Driven by Strong Data Center Demand

Micron Technology concluded fiscal 2025 with a record revenue of $37.4 billion, representing a 49% increase year-over-year, driven by strong data center demand and a 17 percentage point expansion in gross margins to 41%. The company's fiscal Q4 revenue reached $11.3 billion, a 22% sequential increase and a quarterly record. Earnings per share (EPS) came in at $3.03, beating estimates of $2.86. The revenue growth was fueled by customer demand across all end markets, with record data center revenue and strong sequential growth in consumer markets.

Publication Date: Sep -26

📋 Highlights
  • Record FY25 Revenue:: Micron achieved $37.4 billion, up 49% YoY, with 17pp gross margin expansion to 41%.
  • Q4 Revenue Surge:: $11.3 billion revenue (22% sequential growth), driven by record data center revenue and strong consumer demand.
  • DRAM Dominance:: DRAM revenue hit $9 billion (69% YoY growth), while NAND saw $2.3 billion (5% sequential rise despite 5% YoY decline).
  • Data Center Margins:: CMBU gross margins expanded to 59% (up from 41% in CDBU), driven by HBM demand and cost reductions.
  • Q1 Guidance:: $12.5 billion revenue (±$300M), $3.75 non-GAAP EPS (±15¢), and $4.5 billion capital spending for Q1 FY2026.

Segment-wise Performance

DRAM revenue hit a record $9 billion, a 69% year-over-year increase, driven by strong demand across all end markets and tight industry supply. NAND revenue reached $2.3 billion, a 5% year-over-year decline, but a 5% sequential increase due to favorable mix. The company's data center business, comprising its cloud memory and core data center business units, reached record revenue. The cloud memory business unit achieved $4.5 billion in revenue, with gross margins expanding to 59%, driven by cost reductions and strong demand for HBM products.

Guidance and Outlook

Micron expects calendar 2025 industry DRAM bit demand growth to be in the high teens percentage range, and calendar 2025 industry NAND bit demand growth to be in the low to mid-teens percentage range. The company anticipates further DRAM supply tightness in 2026 and continued strengthening in NAND market conditions. For the first quarter, Micron expects revenue to be a record $12.5 billion, plus or minus $300 million, and non-GAAP EPS to be a record $3.75 per share, plus or minus 15¢.

Valuation and Growth Prospects

With a P/E Ratio of 20.63 and an expected revenue growth of 37.4% next year, Micron's valuation appears reasonable. The company's Return on Equity (ROE) stands at 17.05%, and its Return on Invested Capital (ROIC) is 15.83%, indicating strong profitability. The Net Debt / EBITDA ratio is 0.27, suggesting a healthy debt position. Analysts expect significantly higher annual free cash flow year over year, which is a positive indicator for the company's growth prospects.

Innovation and Product Development

Micron is investing heavily in its one gamma DRAM and HPM-related technologies, leading to higher capital spending in fiscal 2026. The company's HBM4 product exceeds customer bandwidth requirements, and its innovative design has positioned Micron for a successful HBM4 ramp. With HBM4e expected to follow in 2027, Micron is well-placed to capitalize on the growing demand for high-bandwidth memory products.

3. NewsRoom

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Stocks Mixed as Market-Moving Catalysts Dry Up

Dec -04

Source: schaeffersresearch.com

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Micron: Why An Exit From Consumer Isn't Scary

Dec -04

Source: seekingalpha.com

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Micron Technology Soars 178% YTD: Should You Still Buy the Stock?

Dec -04

Source: zacks.com

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Micron to Dump 'Crucial' Consumer Business. It's All About AI.

Dec -04

Source: barrons.com

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2 Top AI Stocks to Buy in December

Dec -04

Source: fool.com

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Micron (MU) Stock Declines While Market Improves: Some Information for Investors

Dec -03

Source: zacks.com

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Beyond NVIDIA: 5 Semiconductor Stocks Set to Dominate 2026

Dec -03

Source: marketbeat.com

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Micron stops selling memory to consumers as demand spikes from AI chips

Dec -03

Source: cnbc.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.37%)

6. Segments

Compute and Networking Business Unit (CNBU)

Expected Growth: 8.5%

Growing demand for memory products in computing, networking, and data center applications driven by increasing adoption of AI, cloud computing, and 5G technology. Expansion of data center infrastructure and rising need for high-performance memory solutions will fuel growth, driven by Micron's technological advancements and diversified product portfolio.

Mobile Business Unit (MBU)

Expected Growth: 10.5%

The Mobile Business Unit (MBU) is poised for growth driven by increasing demand for high-performance memory and storage in 5G-enabled smartphones, emerging AI and IoT applications, and the need for advanced storage solutions in mobile devices, with a forecast CAGR of 10.5% through 2025.

Embedded Business Unit (EBU)

Expected Growth: 8.5%

The EBU's growth is driven by increasing demand for memory and storage in IoT, automotive, and industrial applications. Expansion into emerging tech like AI, 5G, and edge computing, alongside Micron's tech advancements, will fuel an 8.5% CAGR. Growing adoption of connected devices and sophisticated data processing needs will sustain growth.

Storage Business Unit (SBU)

Expected Growth: 10.5%

The Storage Business Unit is expected to grow at a CAGR of 10.5% driven by increasing demand for NAND and NOR flash memory solutions in 5G, AI, and IoT applications. Growing adoption of cloud storage, edge computing, and autonomous vehicles will fuel growth, with Micron's technology advancements and expanding production capacity supporting market share gains.

All Other

Expected Growth: 5.0%

The 'All Other' segment of Micron Technology, Inc. is expected to grow at a CAGR of 5% driven by increasing licensing revenue and minor operations. This growth is attributed to the company's expanding intellectual property portfolio and strategic partnerships, leading to higher royalty income and other miscellaneous revenue streams.

7. Detailed Products

DRAM (Dynamic Random Access Memory)

A type of volatile memory that stores data in a series of capacitors, used for temporary data storage in a wide range of applications.

NAND Flash Memory

A type of non-volatile memory that stores data even when power is turned off, commonly used for storage in a variety of devices.

NOR Flash Memory

A type of non-volatile memory that provides fast random access and is often used for code storage and execution.

3D XPoint Storage

A type of non-volatile memory that offers high performance and low latency, designed for use in storage devices.

Graphics Processing Units (GPUs) and High-Performance Memory

Specialized memory products designed for use in graphics processing units (GPUs) and other high-performance computing applications.

Memory and Storage for Automotive

A range of memory products designed for use in automotive systems, including DRAM, NAND Flash, and NOR Flash.

Memory and Storage for Mobile Devices

A range of memory products designed for use in mobile devices, including smartphones and tablets.

8. Micron Technology, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Micron Technology, Inc. operates in the semiconductor industry, where substitutes such as flash memory and DRAM are available. However, the company's products are highly specialized and have a strong reputation, which reduces the threat of substitutes.

Bargaining Power Of Customers

Micron Technology, Inc. has a diverse customer base, including major technology companies. While customers have some bargaining power, Micron's products are essential components in many devices, which limits their ability to negotiate prices.

Bargaining Power Of Suppliers

Micron Technology, Inc. relies on suppliers for materials and equipment. While suppliers have some bargaining power, Micron has long-term relationships with many of its suppliers and has a strong negotiating position.

Threat Of New Entrants

The semiconductor industry has high barriers to entry, including significant research and development costs, complex manufacturing processes, and a need for highly specialized talent. This reduces the threat of new entrants.

Intensity Of Rivalry

The semiconductor industry is highly competitive, with many established players competing for market share. Micron Technology, Inc. competes with companies such as Samsung, Intel, and SK Hynix, which increases the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 23.69%
Debt Cost 6.31%
Equity Weight 76.31%
Equity Cost 10.15%
WACC 9.24%
Leverage 31.04%

11. Quality Control: Micron Technology, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Analog Devices

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Value: 1.1

Growth: 4.6

Quality: 7.3

Yield: 4.0

Momentum: 5.0

Volatility: 7.0

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Micron

A-Score: 4.8/10

Value: 2.5

Growth: 6.8

Quality: 7.3

Yield: 0.0

Momentum: 9.0

Volatility: 3.3

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Growth: 5.0

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Growth: 6.8

Quality: 6.6

Yield: 0.0

Momentum: 5.0

Volatility: 3.0

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Intel

A-Score: 3.5/10

Value: 4.1

Growth: 1.2

Quality: 3.2

Yield: 1.0

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A-Score: 3.3/10

Value: 2.8

Growth: 6.9

Quality: 5.7

Yield: 0.0

Momentum: 1.5

Volatility: 3.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

237.22$

Current Price

237.22$

Potential

-0.00%

Expected Cash-Flows