Micron Beats on Q4 Earnings: Will Strong Guidance Lift the Stock?

Micron Technology (MU) reported fourth-quarter fiscal 2025 earnings of $3.03 per share, beating the Zacks Consensus Estimate by 5.9%. The company’s fourth-quarter earnings jumped 156.8% year over year from the year-ago quarter’s earnings of $1.18 per share.

Micron’s revenues increased 46% year over year to $11.32 billion and beat the Zacks Consensus Estimate by 1.2%. The top line was driven by robust demand for its high bandwidth memory (HBM) products.

Buoyed by better-than-expected financial performance, Micron issued strong guidance for the first quarter of fiscal 2026. The company’s forecast for the top and bottom lines was above the Zacks Consensus Estimate.

MU’s overwhelming fourth-quarter results, along with upbeat guidance for the first quarter, are likely to boost its share price. Year to date, the stock has soared 101.1%, outperforming the Zacks Computer and Technology sector’s growth of 23.6%.

Micron Technology, Inc. Price, Consensus and EPS Surprise

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

Micron’s Q4 Top-Line Details

Technology-wise, DRAM revenues of $8.98 billion, accounting for 79.4% of the total revenues in the fiscal fourth quarter, increased 68.7% year over year and 27% sequentially. The company experienced record demand for data center DRAM, driven by strong growth in HBM and robust performance of high-capacity DIMMs and low-power server DRAM products.

NAND revenues of $2.3 billion, representing 19.9% of the total revenues, were down 4.8% year over year but increased 5% quarter over quarter.

Other revenues were $79 million in the reported quarter, which increased from $59 million in the year-ago quarter and was up from $75 million in the previous quarter.

Previously, Micron used to report its business segments as follows: Compute and Networking Business Unit, Mobile Business Unit, Embedded Business Unit and Storage Business Unit.

Following the reorganization, its disclosure of business segments is as follows: Cloud Memory Business Unit, Core Data Business Unit, Mobile and Client Business Unit and Auto and Embedded Business Unit.

Business segment-wise, revenues of $4.54 billion from the Cloud Memory Business Unit soared 214% from the year-ago quarter and 34% sequentially, driven by a record increase in HBM revenues.

Revenues of $1.57 billion from the Core Data Business Unit declined 23% on a year-over-year basis but increased 3% on a quarter-over-quarter basis due to higher pricing and a favorable mix.

The Mobile and Client Business Unit’s revenues were $3.76 billion, up 25% from the year-ago period and up 16% from the previous quarter. Revenues from the Auto and Embedded Business Unit totaled $1.43 billion, which increased 17% year over year and 27% sequentially.

MU’s Q4 Operating Details

For the fiscal fourth quarter, MU posted a non-GAAP gross profit of $5.17 billion, representing a robust improvement from the year-ago quarter’s $2.83 billion. Also, Micron’s non-GAAP gross profit increased 42.7% sequentially.

The fiscal fourth-quarter non-GAAP gross margin of 45.7% improved from the year-ago quarter’s 36.5%. The non-GAAP gross margin increased 670 basis points from the previous quarter’s 39%.

Non-GAAP operating expenses were $1.214 billion compared with the previous quarter’s $1.133 billion and the year-ago quarter’s $1.081 billion.

Micron’s non-GAAP operating income of $3.955 billion was higher than the previous quarter’s non-GAAP operating income of $2.490 billion. It also shows significant improvements from the year-ago quarter’s non-GAAP operating income of $1.745 billion.

The non-GAAP operating margin came in at 35%. Micron posted a non-GAAP operating margin of 26.8% for the previous quarter, and it had a non-GAAP operating margin of 22.5% in the year-ago quarter.

Micron’s Balance Sheet & Cash Flow

MU exited the reported quarter with cash and investments of $19.95 billion compared with $10.81 billion at the end of the prior quarter. Its total debt, as of Aug. 28, 2025, was $14.017 billion compared with the $15 billion witnessed at the end of the previous quarter.

The company generated an operating cash flow of $5.73 billion in the fiscal fourth quarter. It spent $4.93 billion on capital expenditure in the quarter, resulting in an adjusted free cash flow of $803 million. MU paid out $522 million in dividends but repurchased no shares in the fourth quarter of fiscal 2025.

MU’s Q1 FY26 Outlook

Micron provided its guidance for the first quarter of fiscal 2026. The company anticipates revenues of $12.5 billion (+/-$300 million) in the fiscal first quarter. The Zacks Consensus Estimate is pinned at $12.05 billion.

For the fiscal first quarter, MU projects a non-GAAP gross margin of 51.5% (+/-100 basis points). Operating expenses on a non-GAAP basis are estimated to be $1.34 billion (+/-$20 million).

Adjusted EPS is anticipated to be $3.75 (+/- 15 cents). The consensus mark is pegged at a loss of $3.05 per share.

Micron’s Zacks Rank & Other Stocks to Consider

Currently, MU sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks that investors can consider are Amphenol (APH), F5 (FFIV) and CrowdStrike (CRWD), each sporting a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Amphenol’s shares have surged 80.6% year to date. The Zacks Consensus Estimate for Amphenol’s full-year 2025 earnings is pegged at $3.03 per share, up by a cent over the past seven days, indicating an increase of 60.32% from the year-ago quarter’s reported figure.

F5’s shares have gained 29% year to date. The Zacks Consensus Estimate for F5’s full-year fiscal 2025 earnings is pegged at $15.38 per share, up 5.4% over the past 60 days, indicating a gain of 15% from the year-ago quarter’s reported figure.

CrowdStrike’s shares have rallied 41.5% year to date. The Zacks Consensus Estimate for CrowdStrike’s full-year 2026 earnings is pegged at $3.67 per share, down by a cent over the past seven days, indicating a decline of 6.6% from the year-ago quarter’s reported figure.

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