The artificial intelligence revolution has a clear beneficiary in Micron Technology. The memory chip specialist is experiencing unprecedented demand, sold-out production capacity, and a dramatic improvement in profitability, all while strategically pivoting its business toward the data center market. This potent combination has fueled a remarkable rally in its shares and led to one of Wall Street’s most bullish price targets.
Exceptional Quarterly Results Set the Stage
Micron’s operational performance for its fiscal first quarter of 2026 (ended November 2025) shattered market expectations, providing concrete evidence of its accelerating momentum.
- Revenue reached $13.64 billion, significantly surpassing the consensus estimate of $12.62 billion and representing year-over-year growth of 56.7%.
- Earnings per share (EPS) came in at $4.78, well ahead of the $3.77 analysts had forecast.
- The outlook for the second quarter is even more striking, with projected revenue of approximately $18.7 billion and EPS expected between $8.22 and $8.62.
This guidance implies sequential revenue growth of 37% in a single quarter—an extraordinary leap for a company with a market capitalization around $310 billion and a direct reflection of intense demand for AI infrastructure components.
The High Bandwidth Memory (HBM) Advantage
Central to Micron’s success story is its position in the High Bandwidth Memory (HBM) market. HBM is a critical component for AI accelerators, such as those produced by Nvidia. The company’s management confirmed that its entire HBM production capacity is sold out through the end of the 2026 calendar year, with prices and volumes largely locked in by contracts.
This provides Micron with exceptional visibility and sustains high margins. The company’s gross margin has already surged from approximately 22% in fiscal 2024 to over 50%. For the upcoming second quarter, management is targeting a margin of about 68%, underscoring a fundamental improvement in earnings quality.
A Bold Strategic Pivot
Aligning with its operational strength, Micron is sharpening its strategic focus. Reports indicate the company is discontinuing its consumer-focused “Crucial” brand of SSDs and RAM for end-users. This move is designed to systematically redirect resources toward the higher-margin data center and HBM businesses.
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This shift mirrors the current revenue mix, where the data center segment already contributed a record 56% of total sales last quarter. By reallocating wafer capacity from standard memory to advanced AI memory products, Micron significantly increases the revenue generated per unit of silicon processed.
Wall Street’s Bullish Stance
The optimism surrounding Micron’s prospects was recently amplified by analyst Kevin Cassidy of Rosenblatt Securities. Just before Christmas, he raised his price target for the stock from $300 to $500—a new high among covering analysts and implying a potential upside of roughly 80% from recent levels.
Cassidy’s rationale centers on a structural upswing in the memory chip market, propelled by AI. He notes that AI servers require two to three times more DRAM than conventional servers, driving both higher unit volumes and substantially better gross margins per unit.
Insider Activity and Share Price Context
Even amidst the bullish sentiment, some company insiders have taken partial profits. SEC filings show that on December 19, Director Steven Gomo sold 5,000 shares at an average price of $263.63, a transaction worth about $1.32 million. This reduced his direct holding by roughly 20%, though he retains over 19,000 shares. Such sales are not uncommon following a major share price appreciation and represent profit-taking at elevated valuations.
The stock’s performance has been extraordinary. Priced in euros, the shares recently traded at €234.25, just below their 52-week high of €235.35. The equity has gained approximately 172% over the past twelve months and over 175% year-to-date. The current price sits more than 80% above its 200-day moving average of €129.82, indicating a powerful but extended upward trend.
Conclusion: Positioned at the Heart of the AI Buildout
Micron has unequivocally positioned itself as a primary winner in the global AI infrastructure expansion. With its HBM capacity sold out through late 2026, margins climbing rapidly, and a refined focus on the stable data center business over cyclical consumer products, the company’s trajectory is clear. The ambitious $500 price target from Rosenblatt Securities currently represents the upper bound of market expectations. The critical factor for the coming quarters will be Micron’s ability to deliver on its stated revenue and margin targets for fiscal 2026, thereby continuing to confirm the structural strength of the current AI cycle.
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