Micron Reports After Close: 460% EPS Growth Expected
Micron Technology reports fiscal Q2 results Wednesday with Wall Street expecting $8.74 EPS on $19B revenue. HBM demand remains the key variable.
Micron Technology reports fiscal second-quarter results after the close Wednesday, and the setup couldn't be more important for the AI trade.
Shares rose 4.5% Tuesday to close at $461.69 on volume 20% above average. The move reflects positioning ahead of what Wall Street expects to be a blowout quarter—and potentially transformative guidance for the memory supercycle thesis.
The Numbers
Consensus estimates call for earnings of $8.74 per share on revenue of $19.03 billion. For context: a year ago, Micron earned $1.56 per share on $7.35 billion in revenue. The year-over-year growth rates—460% on EPS, 136% on revenue—underscore how dramatically AI demand has reshaped the memory business.
Management guided to the range of $18.3 billion to $19.1 billion in revenue, with gross margins around 68%. Hitting the high end would represent Micron's first $19 billion quarter ever and validate the pricing power bulls have been betting on.
HBM Is the Story
High Bandwidth Memory revenue is what separates this cycle from previous memory booms.
HBM commands pricing premiums that conventional DRAM doesn't. Micron has said its 2026 HBM capacity is completely sold out, meaning every chip it can produce already has a buyer at premium prices. The question is whether that demand persists into 2027 and whether Micron can expand capacity fast enough to capture it.
Competitors Samsung and SK Hynix are also sold out on HBM. The entire industry is supply-constrained, which is keeping prices elevated even as conventional DRAM pricing has softened in consumer electronics markets.
What to Listen For
Guidance matters more than results. The Q2 numbers are largely known given management's prior forecast. Investors are focused on fiscal Q3 and full-year commentary. Any upward revision to the 2026 outlook would likely push the stock higher; maintaining current guidance might disappoint given the run-up.
HBM revenue mix. Management has guided to HBM revenue tripling in fiscal 2026. Updates on progress toward that target and any color on 2027 supply commitments will move the stock.
DRAM pricing trajectory. Bernstein analyst Mark Li expects 20-25% sequential price gains in Q2. If management confirms that pricing held or exceeded expectations, it supports the supercycle narrative. Any signs of softness would raise questions about cycle duration.
China exposure. Micron lost access to parts of the Chinese market after Beijing restricted purchases. Updates on non-China demand growth and any changes to the geopolitical landscape could affect the risk picture.
Options Positioning
Implied volatility suggests traders expect a move of about 10.6% in either direction following results. That's roughly in line with Micron's historical post-earnings swings, which have averaged 8-12% over the past two years.
Call open interest exceeds put open interest by nearly 2-to-1 for the March weekly options, indicating bullish positioning dominates. The $500 strike has seen particularly heavy activity, representing roughly 8% upside from Tuesday's close.
The Bigger Picture
Micron's report serves as a read-through for the entire semiconductor sector. If HBM demand is as strong as expected, it reinforces the AI infrastructure buildout thesis that's driven chip stocks for two years. Disappointment would raise questions about whether the cycle is peaking.
The stock has already run 92% in three months. Some of the good news is priced in. But in a market where AI enthusiasm shows no signs of fading, the bar for a positive reaction may be lower than skeptics assume.
Results hit at 4:30 p.m. Eastern. The analyst call follows at 6:00 p.m.