Micron forecasts stronger revenue driven by AI demand while high-bandwidth memory (HBM) supply remains critically strained across the industry.

Micron Technology expects fourth fiscal quarter revenue of approximately $50 billion, plus or minus $1 billion—well above analyst estimates of $43.58 billion. The forecast and strong guidance sent the company's shares up more than 9% in after-hours trading.

The company's outperformance reflects explosive growth driven by generative artificial intelligence and the resulting demand for high-bandwidth memory (HBM), which has become a critical component for large data centers. As a key supplier of chips for Nvidia AI processors, Micron is benefiting as AI-focused chip and server makers compete to secure limited supplies.

Micron holds a unique position as the sole producer of advanced memory in the United States. The company notes that demand for HBM chips greatly exceeds manufacturing capacity, with analysts expecting supply to remain constrained for the next two to three years. Memory market players are prioritizing HBM development to meet AI demand, while consumer electronics manufacturers face rising prices for standard memory modules due to the tight supply environment. Micron expects these tight conditions to persist beyond 2027 due to AI-driven demand across all segments and structural supply constraints.

To capitalize on this opportunity, Micron plans to increase dividend payments to shareholders while aggressively expanding its infrastructure. Expected capital expenditures for the fourth quarter will reach approximately $10 billion, exceeding analyst consensus estimates of $8.89 billion.

In the third quarter, the company reported revenue of $41.46 billion, significantly exceeding estimates of $35.85 billion. Adjusted earnings per share came in at $25.11 compared with expectations of $20.78. For the fourth quarter, the company forecasts adjusted EPS of approximately $31, plus or minus $1, against analyst expectations of $25.84.