Key takeaways from Micron’s (MU) first-quarter 2026 results

Micron Technology Inc. (NASDAQ: MU) has reported blockbuster first-quarter results, comfortably beating estimates as strength in data center demand pushed key operating metrics to record levels. Management is now focused on maximizing production, ramping advanced technology nodes, and expanding supply capacity to meet the AI-driven demand. The strong performance and upbeat guidance lifted Micron’s stock in Wednesday’s after-hours trading, marking one of its sharpest post-earnings moves.

New Record

The Boise, Idaho-based memory chipmaker reported revenues of $13.6 billion for the first quarter of fiscal 2026, sharply higher than $8.71 billion reported in the corresponding period of 2025. The top line also exceeded Wall Street’s expectations. Adjusted earnings surged to $4.78 per share in Q1 from $1.79 per share last year, beating estimates. On an unadjusted basis, net income was $5.20 billion or $4.60 per share in Q1, compared to $1.87 billion or $1.67 per share in the prior-year quarter.

Micron shares rallied soon after the earnings announcement, reversing the weakness experienced in the preceding sessions. The stock has shown sustained growth, more than doubling in value over the past four months. It has outperformed the S&P 500 index by a wide margin this year and reached a new high last week. Analysts’ optimistic target price suggests that MU has more room for growth, highlighting a compelling investment opportunity.

Outlook

Buoyed by the strong outcome, the Micron leadership issued a bullish outlook for the second quarter, forecasting record-high revenues of approximately $18.7 billion and adjusted earnings of around $8.42 per share. The guidance for Q2 gross margin is 67%. Operating expense is expected to be $1.56 billion. Management expects strong industry demand and ongoing supply constraints to persist beyond 2026.

“Micron Technology, Inc. plans to increase our fiscal 2026 CapEx to approximately $20 billion versus our prior estimate of $18 billion. This increase will primarily support our HBM supply capability and also our 1-gamma supply in calendar 2026. We are pulling in equipment orders and accelerating installation timelines to maximize output capability. Micron Technology, Inc. is also investing across our global manufacturing footprint to add supply to support longer-term demand. We are seeing an enthusiastic customer response to our planned US supply. We are pulling in our first Idaho fab timeline, and we now expect first wafer output in mid-calendar 2027…” said CEO Sanjay Mehrotra in the Q1 earnings call.

AI Bet

The company has finalized all price and volume agreements on high-bandwidth memory (HBM) for 2026, the total addressable market for which is expected to reach $100 billion by 2028. The HBM demand growth is expected to accelerate this year, driven by the rapid expansion of AI data center capacity. Supported by its strategic focus on AI memory and a broad portfolio of memory and storage solutions, Micron has emerged as a key enabler of AI infrastructure within the semiconductor industry.

Micron’s stock has grown by threefold in the past eight months and is currently trading sharply above its 12-month average. It was trading up 12% on Thursday afternoon, extending the post-earnings rally.