Micron Reports 57% Q1 Revenue Surge, Guides 132% Q2 Growth with 68% Margin
Micron delivered Q1 results with 57% revenue growth and 167% EPS expansion, DRAM revenue up 69%, gross margin rising 17.3 percentage points and operating margin up 19.5 percentage points. The company guides Q2 for 132% year-over-year revenue growth, a 68% gross margin and 440% EPS growth at the midpoint.
1. Exceptional Q1 Performance Fuels Confidence
Micron reported first-quarter revenue of $13.6 billion, representing 57% year-over-year growth driven by surging AI-related memory deployments in data centers. DRAM sales led the charge with a 69% increase, while NAND revenue also contributed double-digit gains. Gross margin expanded by 17.3 percentage points to 56.5%, and operating margin jumped 19.5 percentage points to 43.2%, reflecting both strong pricing power and disciplined cost control. Non-GAAP EPS rose 167% year-over-year to $4.78, well above consensus expectations and marking the highest profit expansion in the company’s history. Micron exited the quarter with a cash balance of $8.2 billion and no short-term debt maturities until fiscal 2028, providing ample liquidity for strategic investments.
2. Q2 Guidance Signals Accelerating Growth
Management’s outlook for the second quarter implies revenue of approximately $15.7 billion, up 132% year-over-year at the midpoint. Guidance assumes gross margin of 68%—a record level—and non-GAAP EPS of $8.50, representing 440% year-over-year growth. The outlook reflects anticipated tight industry supply, continued strength in DRAM pricing, and ramping adoption of high-bandwidth memory (HBM3) in AI training clusters. Capex is forecast at $4.0 billion for the quarter, focused on expanding 1α-node wafer fab capacity in Boise and Japan to address persistent supply shortages through 2027.
3. Structural AI Demand Underpins Long-Term Outlook
Analyst surveys indicate hyperscale data-center operators plan to increase aggregate memory spending by more than 40% annually over the next two years, driven by AI model training and inference deployments. Micron’s share gains in HBM products have lifted its AI-focused segment to represent 39% of total memory revenue, up from 25% a year ago. The company’s planned $1.8 billion acquisition of a Taiwanese fab site is expected to add 20% incremental DRAM capacity by mid-2027. With leading process technology on track for tape-outs of 1β-node DRAM and next-generation QLC NAND in 2026, Micron is positioned to sustain high margins and double-digit revenue growth throughout the AI supercycle.