Micron Technology Inc (MU)

Micron Technology, Inc. operates as a global leader in semiconductor memory and storage, powering AI and compute-intensive applications from cloud to edge, with a comprehensive portfolio of high-performance DRAM, NAND, and NOR solutions. The company manufactures products at wholly-owned facilities and also utilizes subcontractors for certain manufacturing processes, with manufacturing centers of excellence located in Taiwan, Singapore, Japan, the United States, Malaysia, China, and India. The semiconductor memory and storage markets are intensely competitive, and the company must continuously develop and implement new products and technologies and decrease manufacturing costs in spite of inflationary pressures, changing technologies, rapid market changes, and regulatory uncertainty. Success is largely dependent on obtaining returns on R&D investments, efficient utilization of manufacturing infrastructure, development and integration of advanced product and process technologies, market acceptance of the diversified portfolio, and efficient capital spending. The industry goes through cycles with demand changes that are not fully aligned to available supply, and over the past five fiscal years, annual percentage changes in DRAM and NAND average selling prices have ranged from an increase of approximately 200% to a decrease of approximately 50% ¹. AI currently is, and is expected to continue to be, a significant demand driver for the company's products, though AI is evolving rapidly and the expected timing and amount of demand related to AI can change significantly.

Micron faces intense competition from a number of companies, including Samsung Electronics Co., Ltd.; SK hynix Inc.; Kioxia Holdings Corporation; Sandisk Corporation; ChangXin Memory Technologies, Inc. (CXMT); and Yangtze Memory Technologies Co., Ltd. (YMTC). Competitors may use aggressive pricing to obtain market share, and some are large corporations or conglomerates that may operate in jurisdictions with lower labor and compliance costs and may have larger market share and greater resources to invest in technology, capitalize on growth opportunities, and withstand downturns. Consolidation of industry competitors could put the company at a competitive disadvantage as competitors may benefit from increased manufacturing scale and a stronger product portfolio, and new entrants into the memory and storage market could have a significant adverse impact on competitive position. Governments have provided, and may continue to provide, significant assistance, financial or otherwise, to some competitors or to new entrants, and the company faces the threat of increasing competition and DRAM and NAND oversupply due to significant investment in the semiconductor industry, including by the Chinese government and various state-owned or affiliated entities, such as CXMT and YMTC. The May 2023 decision by China's Cyberspace Administration that critical information infrastructure operators in China may not purchase Micron products had an adverse impact on the company's ability to compete effectively in China and elsewhere. In each of the last three years, approximately one-half of total revenue was from the top ten customers ².

Micron generates revenue through the sale of semiconductor memory and storage products, including DRAM, NAND, and NOR, sold through business units into various markets in numerous forms, including components, modules, SSDs, managed NAND, multi-chip packages, and wafers. Many system-level solutions combine NAND, a controller, firmware, and in some cases DRAM. Products are offered under the Micron brand name and through private labels, marketed primarily through the company's own direct sales force, with sales or representative offices supporting a worldwide customer base, and also offered through distributors, retailers, and independent sales representatives. Contracts with certain customers are short-term in duration, and the company also has strategic customer agreements structured as take-or-pay agreements, with binding commitments for specific contractually enforceable volumes over multi-year contract terms. Pricing for contracts is either fixed or periodically negotiated, with the majority of strategic customer agreements having pricing subject to minimum and maximum bands, and under the strategic agreements, customers have provided financial security in the form of cash deposits and letters of credit. In 2026, approximately one-third of revenue was from sales to customers who have headquarters located outside the United States, while approximately 70% of revenue in 2026 was from products shipped to customer locations outside the United States ³.

The DRAM product line comprises dynamic random access memory semiconductor devices with low latency that provide high-speed data retrieval, used most commonly in the data center, client PC, graphics, industrial, mobile, and automotive markets. In 2025, the company began shipping the industry's first 1γ (1-gamma) production node, its first DRAM node incorporating EUV lithography, offering further improvements in power efficiency, performance, and bit density compared to prior DRAM node products. The 1γ DRAM node is ramping well and on track to become the highest-volume node in the company's history, and the majority of DRAM bit production in the fourth quarter of 2026 was on the leading-edge 1γ node. High-Bandwidth Memory (HBM) is a 3D stacked DRAM architecture that utilizes through-silicon via connections for more efficient communication, achieving higher bandwidth while consuming less power compared to other memory types, making it ideal for AI applications and high-performance computing. Double Data Rate (DDR) memory transfers data twice per clock cycle, with DDR5 offering critical improvements in bandwidth and power efficiency necessary to meet the growing needs of high-performance computing, AI, and data-intensive applications. Low-Power DRAM (LPDDR) is engineered for mobile devices and applications requiring low power consumption, with benefits realized by many market segments, including mobile, PC, automotive, and data center. Graphics DRAM (GDDR) is a high-performance memory solution designed for graphics cards, gaming consoles, and high-performance computing applications. Total reported DRAM revenue was $100.68 billion in 2026 ⁴, $28.58 billion in 2025 ⁵, and $17.60 billion in 2024 ⁶.

The NAND product line comprises non-volatile, re-writable semiconductor storage devices that provide high-capacity, low-cost storage with a variety of performance characteristics, used in SSDs for the data center, client PC, consumer, and automotive markets, and in removable storage markets. Managed NAND is used in smartphones and other mobile devices, and in the consumer, automotive, and embedded markets, while low-density NAND is ideal for applications like automotive, surveillance, machine-to-machine, automation, printer, and home networking. In 2024, the company began volume production of Micron G9 NAND, representative of the industry's ninth-generation 3D NAND node, and the majority of NAND bit production in 2026 was on leading-edge Micron G8 and G9 NAND nodes. NAND flash includes triple-level cell (TLC) and quad-level cell (QLC), each with varying levels of storage density, performance, and endurance. Solid State Drives (SSDs) incorporate NAND, a controller, and firmware to offer significant performance and features over hard disk drives, including smaller form factors, faster read and write speeds, higher reliability, and lower power consumption. Managed NAND combines NAND flash with a sophisticated controller and firmware in a single package, handling tasks like wear leveling, bad block management, and error correction internally. Multi-Chip Packages (MCPs) integrate multiple types of memory, generally LPDDR and NAND, into a single package for embedded IoT applications, automotive systems, mobile devices, and industrial devices. Total reported NAND revenue was $31.79 billion in 2026 ⁷, $8.50 billion in 2025 ⁸, and $7.23 billion in 2024 ⁹.

The company operates through four business units. The Cloud Memory Business Unit (CMBU) is focused on memory solutions for large hyperscale cloud customers and HBM for all data center customers, with sales including DDR, LPDDR, and GDDR. In 2026, HBM3E 12-high represented the majority of HBM shipments, and the company began volume production of HBM4 36GB 12-high with increased bandwidth and superior power efficiency enabled by the 1β (1-beta) process node, and delivered samples of HBM4 48GB 16-high to multiple key customers. Development of HBM4E, leveraging the 1γ DRAM technology node, is well underway, with volume ramp expected in calendar 2027. Total reported CMBU revenue was $43.09 billion in 2026 ¹⁰, $13.52 billion in 2025 ¹¹, and $3.79 billion in 2024 ¹². The Core Data Center Business Unit (CDBU) is focused on storage solutions for all data center customers, including data center SSDs and NAND components, and memory solutions for OEM data center, enterprise, and NeoCloud customers. In 2026, the company began volume production of G9 NAND-based PCIe Gen6 high-performance data center SSDs and began shipping the 245TB 6600 ION SSD, built with G9 QLC NAND. Total reported CDBU revenue was $37.59 billion in 2026 ¹³, $7.23 billion in 2025 ¹⁴, and $4.98 billion in 2024 ¹⁵. The Mobile and Client Business Unit (MCBU) is focused on memory and storage solutions for the mobile and client segments, with sales including DRAM sold to the consumer market and component DRAM and NAND (TLC and QLC). In 2026, the company began volume shipments of its 1γ 16Gb LPDDR5X product to leading smartphone OEMs, sampled its 1γ 24Gb LPDDR5X product to multiple smartphone customers, and began shipping qualification samples of its 1γ 16Gb LPDDR6 product. Total reported MCBU revenue was $36.60 billion in 2026 ¹⁶, $11.86 billion in 2025 ¹⁷, and $11.67 billion in 2024 ¹⁸. The Automotive and Embedded Business Unit (AEBU) is focused on memory and storage solutions for the automotive, industrial, and consumer segments sold into the intelligent edge, including discrete and module DRAM, discrete NAND, managed NAND, SSDs, and NOR. In 2026, the G9-based UFS 4.1 automotive NAND solution began volume shipments, and the company reached automotive production readiness of its automotive 1γ LPDDR5 DRAM product. Total reported AEBU revenue was $15.89 billion in 2026 ¹⁹, $4.75 billion in 2025 ²⁰, and $4.63 billion in 2024 ²¹.

Significant operational developments during the period include the announcement in December 2025 of an exit of the Crucial consumer products portion of the business, which had consisted of DRAM modules and SSDs sold through retail channels. In 2026, the company announced the establishment of Micron Research Labs, a long-horizon research institution headquartered in Boise, Idaho, supported by a planned investment of approximately $10 billion over the next decade to advance memory, compute and semiconductor manufacturing technologies ²². The company has commenced expansion of production capacity in the United States and in other regions where it operates, and has plans to construct new fabrication facilities and/or ramp production at existing fabrication facilities to increase supply in response to a significant increase in demand for memory products across the industry. As of September 3, 2026, the company had been granted over 62,000 patents ²³ and owned approximately 15,500 active U.S. patents ²⁴ and 8,000 active foreign patents ²⁵, with patents having various terms expiring through 2045. The company had approximately 61,000 employees as of September 3, 2026 ²⁶, located primarily in Asia, North America, and Europe. The company is a member of the Responsible Business Alliance and leverages 11 Employee Resource Groups ²⁷, with ERG membership exceeding more than half the workforce.

High-level financial performance for fiscal 2026 reflects substantial growth across all product lines and business units. Total reported DRAM revenue was $100.68 billion in 2026 , compared to $28.58 billion in 2025 , while total reported NAND revenue was $31.79 billion in 2026 , compared to $8.50 billion in 2025 . CMBU revenue grew to $43.09 billion in 2026 from $13.52 billion in 2025 , CDBU revenue grew to $37.59 billion in 2026 from $7.23 billion in 2025 , MCBU revenue grew to $36.60 billion in 2026 from $11.86 billion in 2025 , and AEBU revenue grew to $15.89 billion in 2026 from $4.75 billion in 2025 . The company's gross margins are dependent upon average selling prices as well as the ability to continue decreasing per gigabit manufacturing costs, primarily achieved through improvements in manufacturing processes and product designs. In recent periods, industry demand has outpaced supply, driving average selling prices higher, but as the company and others increase supply, average selling prices may decline, particularly if demand growth slows or declines. The company's manufacturing costs are largely fixed and do not vary proportionally with changes in production output, so lower utilization, lower wafer output, and corresponding increases in per gigabit manufacturing costs could result in higher inventory carrying costs and have an adverse effect on gross margins.

Development of HBM4E, the next-generation HBM product leveraging the production-proven 1γ DRAM technology node, is well underway, and the company expects to ramp volume in calendar 2027. HBM4E is expected to deliver another step-function improvement in performance, enabling a whole new generation of AI compute platforms across the industry, and HBM4E customization options offer further differentiation opportunities and even deeper R&D engagement with customers. The company plans to increase EUV adoption at the 1δ (1-delta) DRAM node utilizing the latest-generation EUV tools, which will help optimize both cleanroom space efficiency and patterning when scaling to 1δ and beyond. The 1γ DRAM node is ramping well and on track to become the highest-volume node in the company's history, and the majority of DRAM bit production in the fourth quarter of 2026 was on the leading-edge 1γ node.

The company has commenced expansion of production capacity in the United States and in other regions where it operates, and has plans to construct new fabrication facilities and/or ramp production at existing fabrication facilities to increase supply in response to a significant increase in demand for memory products across the industry. Semiconductor fabs are complex, capital-intensive projects requiring specialized knowledge, expertise, experience, and skill sets to construct and operate, and construction projects are highly dependent on available sources of materials and specialized equipment, as well as labor, skilled sub-contractors, and other service providers. Increasing demand, supply constraints, inflation, and other market conditions could result in shortages and higher costs, and difficulties in obtaining labor, skilled sub-contractors, and other service providers or other resources could result in delays in completion of construction projects and cost increases, including costs to operate these facilities. In the United States and in certain other regions, fab building has been uncommon in recent years, and concurrent semiconductor expansion projects across the industry introduce significant competition for the limited pool of construction talent with requisite expertise and experience in these regions.

The company's R&D efforts are focused primarily on development of memory and storage solutions, including industry-leading DRAM and NAND technology, that enable continuous improvement in performance and cost structure. Product design and development efforts include HBM, DDR, LPDDR, high-capacity DRAM modules, vertically stacked DRAM products for edge and data center applications and advanced graphics DRAM; TLC and QLC NAND technologies; and storage solutions (including firmware and controllers) in SSDs; and other memory technologies and systems enabled with advanced packaging technologies. R&D centers are located in Boise, Idaho; San Jose, California; India; Japan; Singapore; Taiwan; Italy; Mexico; China; Germany; Malaysia; and other sites in the United States. In 2026, the company announced the establishment of Micron Research Labs, a long-horizon research institution headquartered in Boise, Idaho, supported by a planned investment of approximately $10 billion over the next decade to advance memory, compute and semiconductor manufacturing technologies . R&D expenses vary primarily with the number of development and pre-qualification wafers processed and end-product solutions developed, personnel costs, and the cost of advanced equipment dedicated to new product and process development, such as investments in EUV lithography equipment.

The company's gross margins are dependent upon average selling prices as well as the ability to continue decreasing per gigabit manufacturing costs, which is primarily achieved through improvements in manufacturing processes and product designs. Factors that may limit the ability to control per gigabit manufacturing costs at sufficient levels include strategic product diversification decisions affecting product mix; increasing complexity of the product portfolio and manufacturing processes; difficulties in transitioning to smaller line-width process technologies or additional 3D memory layers or NAND cell levels; process complexity, including number of mask layers and fabrication steps; manufacturing yield and defect density; technological barriers; changes in process technologies; new products that may require relatively larger die sizes or advanced packaging technologies; increases in capital expenditures, including start-up or other costs associated with capacity expansions; regional cost differences; higher costs of goods and services due to inflationary pressures, labor disputes, regulatory actions, including tariffs or trade restrictions, increased input costs, or market conditions; and higher manufacturing costs per gigabit due to fabrication facility underutilization, lower wafer output, and insufficient volume to run new technology nodes to achieve cost optimization. A significant portion of manufacturing costs are fixed and do not vary proportionally with changes in production output, so lower utilization, lower wafer output, and corresponding increases in per gigabit manufacturing costs could result in higher inventory carrying costs and have an adverse effect on gross margins.

The company's supply chain and operations are dependent on the availability of materials that meet exacting standards and the use of third parties to provide components and services. The company generally has multiple sources of supply for materials and services, but only a limited number of suppliers are capable of delivering certain materials, components, and services that meet standards, and in some cases, materials, components, or services are provided by a single or sole source. Shortages or increases in lead times have occurred in the past, are currently occurring with respect to some materials and components, and may occur from time to time in the future. Increasing AI-driven demand may intensify competition for critical materials, manufacturing equipment, advanced packaging capacity, and other key inputs, which could increase costs, extend lead times, or limit availability. Certain materials are primarily available in a limited number of countries, including rare earth elements, minerals, and metals, and China is a predominant producer of these materials and has restricted export of certain of these materials. The company's operations are dependent on a reliable and uninterrupted supply of electrical power, gas, and water to manufacturing facilities, and growing demand from semiconductor manufacturing, AI-related data centers, and other industrial development may increase competition for utility resources and contribute to power shortages, capacity constraints, prolonged outages, or increased utility costs.

The company's R&D expenses vary primarily with the number of development and pre-qualification wafers processed and end-product solutions developed, personnel costs, and the cost of advanced equipment dedicated to new product and process development, such as investments in EUV lithography equipment. The company has commenced expansion of production capacity in the United States and in other regions where it operates, and construction projects are highly dependent on available sources of materials and specialized equipment, as well as labor, skilled sub-contractors, and other service providers. The company also relies on a large, skilled workforce to operate semiconductor manufacturing facilities worldwide, and certain employees have formed or joined labor unions, with additional unionization efforts possibly occurring in the future. A strike, work stoppage, slowdown, or other form of labor action at any manufacturing facility could cause significant business interruption, including the temporary or prolonged cessation of production at one or more fabrication lines.

The company faces geopolitical and other risks associated with international operations, with a substantial portion of operations conducted in Taiwan, Singapore, Japan, Malaysia, China, and India. A majority of DRAM production output in 2026 was from fabrication facilities in Taiwan, and any loss of output could have a material adverse effect on the company. Following the May 2023 decision of its cybersecurity review of products sold in China, the CAC determined that critical information infrastructure operators in China may not purchase Micron products, impacting revenue with companies headquartered in mainland China and Hong Kong, including direct sales, as well as indirect sales through distributors. Further actions by the Chinese government, through CAC action or other means, could impact revenue inside or outside China, or operations in China, or the ability to ship products to customers. The U.S. government has in the past and continues to restrict U.S. firms, including the company, from selling products and software to certain customers and may in the future impose similar restrictions on one or more significant customers.

The company's industry goes through cycles with demand changes that are not fully aligned to available supply. Over the past five fiscal years, annual percentage changes in DRAM and NAND average selling prices have ranged from an increase of approximately 200% to a decrease of approximately 50% . In recent periods, industry demand has outpaced supply, driving average selling prices higher, but as the company and others increase supply, average selling prices may decline, particularly if demand growth slows or declines. Conversely, in some prior periods, average selling prices for products have been below manufacturing costs, and such circumstances may occur in the future. AI currently is, and is expected to continue to be, a significant demand driver for products, but AI is evolving rapidly, and the expected timing and amount of demand related to AI can change significantly and may be impacted by many factors, making it difficult to accurately forecast such demand, particularly over the longer term. Periods of sustained higher prices for memory and storage products may reduce demand or result in customers modifying product designs to reduce memory and storage content or seeking alternative technologies and solutions, and sustained higher prices may attract new entrants into the memory and storage market.

Management's message to shareholders emphasizes the company's position as a global leader in semiconductor memory and storage, powering AI and compute-intensive applications from cloud to edge, with a relentless focus on customers, technology and product leadership, and manufacturing and operational excellence. The company's comprehensive portfolio of high-performance DRAM, NAND, and NOR solutions is designed to deliver the speed, efficiency, and scale today's workloads demand, accelerating intelligence to enrich life for all. Management highlights that the 1γ DRAM node is ramping well and on track to become the highest-volume node in the company's history, with the majority of DRAM bit production in the fourth quarter of 2026 on the leading-edge 1γ node, and that development of HBM4E is well underway with volume ramp expected in calendar 2027. The company began volume production of HBM4 36GB 12-high with increased bandwidth and superior power efficiency enabled by the 1β process node, and delivered samples of HBM4 48GB 16-high to multiple key customers to power next-generation AI platforms. Management also notes that in 2026, the company began volume production of G9 NAND-based PCIe Gen6 high-performance data center SSDs and began shipping the 245TB 6600 ION SSD built with G9 QLC NAND. The company announced the establishment of Micron Research Labs, a long-horizon research institution headquartered in Boise, Idaho, supported by a planned investment of approximately $10 billion over the next decade to advance memory, compute and semiconductor manufacturing technologies . Strategic priorities emphasized for the period ahead include maintaining technology and product leadership through continued R&D investment, expanding production capacity in the United States and other regions to increase supply in response to significant demand, and optimizing the product portfolio to best respond to changing market dynamics, including the exit of the Crucial consumer products portion of the business announced in December 2025.

Total reported DRAM revenue was $100.68 billion in 2026 , compared to $28.58 billion in 2025 , and total reported NAND revenue was $31.79 billion in 2026 , compared to $8.50 billion in 2025 . Total reported CMBU revenue was $43.09 billion in 2026 , compared to $13.52 billion in 2025 ; CDBU revenue was $37.59 billion in 2026 , compared to $7.23 billion in 2025 ; MCBU revenue was $36.60 billion in 2026 , compared to $11.86 billion in 2025 ; and AEBU revenue was $15.89 billion in 2026 , compared to $4.75 billion in 2025 . The company's gross margins are dependent upon average selling prices as well as the ability to continue decreasing per gigabit manufacturing costs, and a significant portion of manufacturing costs are fixed and do not vary proportionally with changes in production output. Over the past five fiscal years, annual percentage changes in DRAM and NAND average selling prices have ranged from an increase of approximately 200% to a decrease of approximately 50% . In each of the last three years, approximately one-half of total revenue was from the top ten customers . In 2026, approximately one-third of revenue was from sales to customers who have headquarters located outside the United States, while approximately 70% of revenue in 2026 was from products shipped to customer locations outside the United States . As of September 3, 2026, the company had been granted over 62,000 patents and owned approximately 15,500 active U.S. patents and 8,000 active foreign patents , and had approximately 61,000 employees .

The most material risks to Micron's business center on extreme average selling price volatility, competitive intensity, and geographic concentration. Over the past five fiscal years, annual percentage changes in DRAM and NAND average selling prices have ranged from an increase of approximately 200% to a decrease of approximately 50% , and in some prior periods average selling prices have been below manufacturing costs. A significant portion of manufacturing costs are fixed and do not vary proportionally with production output, so lower utilization and lower wafer output increase per gigabit manufacturing costs and can adversely affect gross margins. The company faces intense competition from Samsung Electronics Co., Ltd.; SK hynix Inc.; Kioxia Holdings Corporation; Sandisk Corporation; ChangXin Memory Technologies, Inc. (CXMT); and Yangtze Memory Technologies Co., Ltd. (YMTC), and faces the threat of DRAM and NAND oversupply due to significant investment in the semiconductor industry, including by the Chinese government and various state-owned or affiliated entities. The May 2023 decision by China's Cyberspace Administration that critical information infrastructure operators in China may not purchase Micron products had an adverse impact on the company's ability to compete effectively in China and elsewhere. A majority of DRAM production output in 2026 was from fabrication facilities in Taiwan, and any loss of output could have a material adverse effect on the company. In 2026, approximately one-third of revenue was from sales to customers headquartered outside the United States, while approximately 70% of revenue was from products shipped to customer locations outside the United States , and in each of the last three years approximately one-half of total revenue was from the top ten customers .