Micron's AI Memory Dominance Drives 9x EPS Surge

Micron's AI Memory Dominance Drives 9x EPS Surge; Stock Remains Undervalued

Micron Technology reported record fiscal 2026 results fueled by artificial intelligence demand, with management projecting sustained growth through 2030 and 26 strategic customer agreements securing 35 percent of revenue.

The Markets Desk

Gokhshtein Media

October 3, 2026

3 min read

Micron Technology (MU) delivered record results for its fourth quarter of fiscal 2026, which concluded on Sept. 3, easily surpassing consensus estimates. The memory specialist's stock has surged over 600 percent in the past year, driven by the artificial intelligence memory boom.

For the full fiscal year 2026, Micron's revenue increased 256 percent over the prior year, reaching $133.2 billion. The company's operating income margin nearly tripled to 76 percent, a direct result of memory demand outstripping supply and pushing up prices.

Non-GAAP earnings per share (EPS) for fiscal 2026 increased more than 900 percent from the previous year, settling at $75.52. CEO Sanjay Mehrotra said on the latest earnings call that favorable memory market dynamics will continue for at least the next couple of years, with momentum expected to extend beyond fiscal years 2027 and 2028.

Micron has secured 26 strategic customer agreements (SCAs) that will account for 35 percent of its revenue through 2030. The company is now receiving customer requests for supply agreements that extend into 2031, indicating robust long-term demand.

Approximately 75 percent of these SCAs feature a defined price band, including both a floor and a ceiling price. Pricing for the remaining long-term agreements will be negotiated periodically with customers, responding to prevailing market dynamics.

Industry projections indicate that supply constraints in the memory market will persist until 2030. This environment positions Micron to command favorable pricing throughout the decade, supporting its strong financial outlook.

Despite its exponential earnings growth, Micron stock trades at 14.6 times earnings. This represents a discount compared to the S&P 500 index's earnings multiple of 23.5, suggesting the stock is undervalued given its growth trajectory.

Analysts expect Micron's EPS to jump 134 percent in fiscal 2027, reaching $176.69, according to Yahoo! Finance. This is projected to be followed by a 16 percent increase in fiscal 2028, pushing EPS to $205.30.

Assuming a conservative 10 percent earnings growth in fiscal 2029, Micron's bottom line is projected to reach $225.83 per share after three years. This analyst consensus underscores the sustained earnings power from the AI memory cycle.