Micron reported first-quarter revenue of $13.6 billion, a 56.7% increase year-on-year, driven by surging demand for high-bandwidth memory (HBM) used in AI data centers. Gross margin expanded by 170 basis points to reach 45.6%, while operating income jumped 168.2% compared to the prior year. Net income more than doubled, climbing from $1.9 billion to $5.2 billion, and free cash flow soared 159.5% to $8.4 billion, underscoring the company’s ability to convert record sales into robust profitability and liquidity.

Management guided second-quarter revenue of $18.7 billion, implying 132% year-on-year growth, and forecast non-GAAP EPS of $8.22 to $8.62, reflecting locked-in HBM contracts and improved node efficiencies. TrendForce data indicates DRAM prices rose 50% sequentially in the final quarter and are projected to climb another 40% this quarter. Micron’s multi-year pricing agreements with hyperscale cloud customers cement sustained margin expansion, with analysts now expecting full-fiscal 2026 adjusted earnings of approximately $32 per share.

Industry capacity remains constrained, with demand for DRAM outstripping supply by an estimated 10%. Micron has sold out its 2026 HBM volumes and is negotiating favorable multi-year contracts that secure both volume and pricing. The company plans a $100 billion megafab in New York under the CHIPS Act, positioning it to capture a larger share of the projected $100 billion AI memory total addressable market. With cash reserves near $9.7 billion and a net income margin above 28%, Micron is well-capitalized to sustain capital expenditures and fund technology upgrades into 2027.