Micron Technology: Why I Am Maintaining A Strong Buy
- Antonia Njeru
- 3 days ago
- 8 min read
Summary
I maintain a Strong Buy on Micron Technology due to accelerating AI memory demand. Micron's 3Q FY 2026 results indicate extreme and sustained supply tightness in the industry. High-bandwidth memory (HBM), advanced DRAM, and data center NAND are supply constrained, with demand far exceeding production capacity and visibility extending years ahead.
Micron’s 3Q FY2026 results marked a step-function higher in financial performance, with $41.46Bn in revenue, 85% gross margins and $25.11 EPS, far exceeding prior expectations and reinforcing a structural change in profitability. The company has guided an even stronger 4Q FY 2026n, expecting $50B revenue, 86% gross margins and $31 EPS, signalling that earnings power is still expanding rapidly.
The shift toward long-term Strategic Customer Agreements [SCAs] continues to transform Micron’s business model, with 16–17 agreements now signed, covering up to half of future revenue under multi-year, take-or-pay structures. This significantly improves revenue visibility, pricing stability and reduces exposure to traditional memory price volatility.
Despite this unprecedented growth in revenue, margins and forward visibility, Micron continues to trade at a material discount to semiconductor peers, reflecting lingering market perception of memory as a cyclical commodity rather than a core AI infrastructure layer.
