Micron Earnings Report Key Takeaways: Long-Term Agreements Extend to 2030, Delivering a $100 Billion-Plus Revenue Floor

ME News, June 25 (UTC+8), Micron released its earnings this morning. Key information is summarized as follows:

I. Performance (reported quarter) Quarterly revenue of $41.46B (some sources record $41.5B), above market expectations of approximately $35.8B. Adjusted EPS of $25.11, above market expectations of approximately $20.7~$20.8. Gross margin of 84.9%, above market expectations of 81.9%.

II. Next quarter guidance (Q4) Revenue guidance of $49.0~$51.0 billion, midpoint of $50.0 billion, above market expectations of $43.24 billion. Adjusted EPS guidance of $30~$32, midpoint of $31, above market expectations of $25.31.

III. Long-term agreements (LTA/SCA) and customer lock-ins 16 long-term strategic customer agreements have been signed, primarily covering the period from 2026 to the end of 2030. The agreements include take-or-pay clauses. Management estimates these agreements correspond to approximately $100 billion in guaranteed revenue. Approximately $22 billion in cash deposits and financial commitments will be received. Signed agreements cover approximately 20% of DRAM production and about one-third of NAND production over the corresponding period. Management expects about half or more of future revenue to be covered under long-term agreements.

IV. Supply-demand and industry outlook The company expects tight supply-demand conditions for DRAM and NAND to persist beyond 2027. DRAM industry shipments are expected to grow 20%~25% in 2026, revised up from previous expectations. NAND industry shipments are expected to grow about 20% in 2026, in line with previous expectations. Micron's DRAM supply growth is expected to be roughly in line with the industry. Micron's NAND supply growth is expected to be slightly below the industry.

V. Capital expenditure and capital return Market feedback indicates the company's capital expenditure is in line with expectations. No obvious aggressive expansion plans are seen. The company stated that Q4 will significantly increase capital returns. The $22 billion in customer prepayments is roughly equivalent to about one-third of capital expenditure over the next two years. (Source: ODAILY)