Micron (MU) Q3 Earnings Crush Estimates: AI Boom Sends Memory Demand—and Profits—Soaring

Another quarter, another beat—Micron just can't seem to miss when AI's ravenous appetite for memory chips keeps shoving cash into its pockets.

The AI gold rush strikes again

While Wall Street analysts were busy polishing their crystal balls, Micron bulldozed through Q3 expectations like a data center racking up GPU orders. Turns out, artificial intelligence needs an absurd amount of high-bandwidth memory—who knew?

Memory margins get a caffeine hit

DRAM and NAND pricing decided to wake up from its crypto-winter nap, delivering the kind of gross margins that make CFOs giggle during earnings calls. Funny how 'supply discipline' suddenly works when your biggest clients are trillion-dollar tech giants.

The cynical take

Let's see how long this lasts before the semiconductor cycle does what it always does—turns 'scarcity' into a warehouse glut just in time for the next earnings guidance cut. But for now? Enjoy the AI-fueled sugar high while it lasts.

TLDR

• Q3 adjusted EPS of $1.91 vs. $1.61 expected, revenue of $9.3B beats $8.85B forecast

• DRAM revenue hit record high; HBM sales up 50% sequentially

• Q4 revenue forecast raised to $10.4B–$11B with EPS of $2.35–$2.65

• Gross margin improved to 37.7%; free cash flow at $1.95B

• Analysts raise price targets on strong AI and data center demand

Micron Technology Inc. (NASDAQ: MU) shares traded at $124.13 in the early afternoon on Thursday following the release of strong third-quarter results.

Micron Technology, Inc. (MU)

The chipmaker beat Wall Street expectations on both revenue and earnings, benefiting from rising demand for AI-powered memory products.

Blowout Quarter Backed by AI Growth

For the fiscal third quarter ended May 29, 2025, Micron reported adjusted earnings per share of $1.91, beating the consensus estimate of $1.61. Revenue ROSE to $9.3 billion, outpacing the forecast of $8.85 billion. The strong results were attributed to improved pricing, growing AI demand, and an upswing in data center orders.

High-bandwidth memory (HBM) sales jumped nearly 50% from the previous quarter, setting a new company record. DRAM revenue also reached an all-time high, while NAND shipments grew 20% sequentially.

Q4 Outlook Raises Expectations

Micron now forecasts Q4 earnings of $2.35 to $2.65 per share, with revenue between $10.4 billion and $11 billion. Both midpoints exceed market expectations and reflect growing confidence in continued AI demand. Gross margins for the next quarter are projected at 42%, a significant improvement from Q3’s 37.7%.

Management highlighted ongoing strength in AI-driven data center demand, a recovering industrial sector, and tightening DRAM supply. Analysts from Piper Sandler and KeyBanc raised price targets to $165 and $160, respectively, citing strong HBM performance and favorable market positioning.

$MU | Micron is +3.8% after-hours

🔹 EPS: $1.91 vs. $1.60 est. ✅
🔹 Revenue: $9.30B vs. $8.86B est. ✅

Key takeaways:
🔸 Networking revenue: +11% YoY
🔸 Mobile revenue: +45% YoY
🔸 Storage revenue: +4% YoY
🔸 Q4 revenue outlook: $10.4B-$11.0B
🔸 Q4 EPS outlook: $2.35-$2.65 pic.twitter.com/UeCyU2ANQB

— CMG Venture Group (@CmgVenture) June 25, 2025

Financial Strength and Market Outlook

Free cash FLOW came in at $1.95 billion, underlining Micron’s operational efficiency. Gross margin of 37.7% and improving pricing mix were central to the strong cash generation. Despite the strong report, shares dipped slightly during the session, possibly due to broader market movements or profit-taking.

Micron’s one-year return stands at 12.55%, outperforming the S&P 500’s 12.04%. Over the past three years, MU has returned 116.08% compared to the benchmark’s 56.90%, reflecting its leading position in memory and AI infrastructure.

Analysts Stay Bullish

Wall Street analysts responded favorably to the Q3 results. Stifel, KeyBanc, and Piper Sandler each raised their price targets, with expectations that Micron will continue to benefit from AI infrastructure demand. The company’s strength in HBM products and growing DRAM share position it well amid tightening industry supply and a favorable pricing environment.

Conclusion

Micron’s Q3 results reinforce its trajectory as a key player in the AI and memory space. Record-setting HBM and DRAM growth, coupled with improved guidance and solid analyst support, position the company for continued upside. Investors appear optimistic about long-term prospects despite short-term volatility.