Strong Momentum in DRAM and NAND to Propel MU's Q4 Earnings

Micron Technology, Inc. MU is set to report its fourth-quarter fiscal 2025 results on Sept. 23, 2025, after market close, and expectations are running high. Micron Technology has been gaining momentum due to the surge in artificial intelligence (AI) investments and its strong ties with leading tech firms.

Micron Technology, on Aug. 11, revised its fourth-quarter fiscal 2025 guidance upward for its revenues, gross margin, operating expense, and EPS. The company previously provided guidance for revenues of $10.7 billion (+/-$300 million), non-GAAP gross margins of 42.0% (+/-1.0%), and non-GAAP EPS of $2.50 (+/-$0.15) for the fourth quarter of fiscal 2025. Now it expects revenues of $11.2 billion (+/-$100 million), non-GAAP gross margins of 44.5% (+/- 0.5%), and non-GAAP EPS of $2.85 (+/- $0.07).

Click here to know how Marvell’s overall fiscal first-quarter results are likely to be.

MU to Benefit From AI Demand Boosting DRAM Sales

Micron Technology has found itself in a sweet spot amid the AI revolution, which is driving the skyrocketing demand for memory and storage solutions. AI systems — particularly large language models and generative AI applications — require massive data processing and storage capabilities, creating a growing need for high-performance DRAM.

Micron Technology, Inc. Price and EPS Surprise

Micron Technology, Inc. price-eps-surprise | Micron Technology, Inc. Quote

Micron Technology’s DRAM segment is expected to be the star of the fourth-quarter results. This not only underscores Micron Technology’s market strength but also highlights the improved pricing dynamics in the DRAM industry. After struggling with oversupply issues in previous years, the memory market is showing signs of stabilization, which has strengthened pricing power and boosted Micron Technology’s margins.

Moreover, Micron Technology’s mass production of its HBM3E (high-bandwidth memory) for NVIDIA Corporation’s NVDA next-generation AI chips, including the H200 GPUs, has positioned it as a vital supplier for AI powerhouses. NVIDIA has collaborated with Micron Technology to power its GPUs with Micron GDDR6X. Additionally, the accelerating adoption of 5G in Internet of Things (IoT) devices and wireless infrastructure is expected to fuel further demand for MU’s memory and storage solutions, enhancing its market position.

MU to Capitalize on Growing NAND Sales

Micron Technology is experiencing a strong NAND momentum from data center and client SSDs. This trend has enabled Micron Technology to achieve the second position as a NAND supplier in the data center SSDs for the first time in the previous quarter. In mobile, Micron Technology secured key design wins and ramped high-volume production of G9-based UFS 4 NAND in the previous quarter.

In the previous quarter, Micron Technology achieved a record-high mix of QLC bits, began qualifying new high-performance SSDs built on its G9 2-terabit QLC NAND, and ramped its G9 node in line with demand, including a newly announced G9-based 2TB SSD with Adaptive Write Technology. Based on these positive factors, Micron Technology’s NAND segment is likely to show robust growth in the fourth quarter of fiscal 2025.

Micron Technology to Benefit From Strong Partner Base

Micron Technology’s partnerships with major tech players, such as NVIDIA, Advanced Micro Devices, Inc. AMD and Marvell Technology, Inc. MRVL, are giving it a big edge in the AI race. These partnerships help Micron Technology secure steady revenue streams and cement its reputation as a trusted supplier in the high-performance computing space.

Micron Technology’s ties with NVIDIA are especially valuable. NVIDIA has confirmed MU as a key HBM supplier for its upcoming GeForce RTX 50 Blackwell GPUs, linking Micron Technology to the fast-growing AI hardware ecosystem. Advanced Micro Devices is another major partner. Micron Technology’s HBM3E chips are being used in Advanced Micro Devices’ upcoming AI-enabled Instinct MI350 GPUs, which should boost sales as AI infrastructure spending rises. Micron Technology is likely to have capitalized on this massive AI infrastructure buildout in the to-be-reported quarter.

Micron Technology is also working with Marvell Technology on custom memory solutions. Marvell Technology is building advanced AI silicon, and Micron Technology’s memory chips are part of its high-performance systems. These partnerships show that MU is becoming a go-to supplier for companies building AI data centers and related technology. These factors are likely to drive this Zacks Rank #1 (Strong Buy) company’s overall earnings growth in the fourth quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research