Micron Technology's stock (NASDAQ:MU) experienced a significant surge following a robust earnings report and a wave of analyst upgrades. The positive momentum stems from heightened demand for memory chips, particularly those utilized in artificial intelligence (AI) applications.
Micron stock price is 14% higher in pre-market trading following earnings, as confidence in the strategic positioning within the rapidly expanding AI and data center markets continues to boost sentiment. Throughout 2025, the MU stock price has climbed approximately 158% before the latest move becomes formalised in the regular session.
The company's November quarter results and February quarter guidance significantly exceeded consensus estimates. Micron reported a second-quarter adjusted profit forecast of $8.42 per share, nearly double Wall Street's expectations of $4.78. Furthermore, the company projected quarterly revenue of $18.7 billion, surpassing the anticipated $14.2 billion. This optimistic outlook is largely attributed to soaring demand for high-bandwidth memory (HBM) chips, which are essential for AI data centers. CEO Sanjay Mehrotra has indicated that memory markets are expected to remain tight beyond 2026, with Micron potentially only meeting a portion of the demand from key customers.
The strong earnings report triggered a series of analyst upgrades and price target increases. Rosenblatt Securities elevated its price target to $500 from $300, reiterating a “Buy” rating. The firm highlighted newly negotiated DRAM and NAND flash prices, combined with ongoing cost reductions, projecting a record gross margin of 68% for the February quarter, driven by demand expected to outstrip supply into 2027.
Needham increased its price target to $300 from $200, citing tightening memory markets and rising DRAM and NAND prices. The firm anticipates higher revenues and earnings for fiscal years 2026 and 2027, fueled by strong data center demand.
Mizuho Securities raised its price target to $300 from $195, maintaining a “Buy” rating, noting strong DRAM pricing, with quarter-over-quarter increases of 15% to 20%, and emphasizing Micron's leadership in high-bandwidth memory used in AI accelerators.
To meet the increasing demand, Micron intends to invest $20 billion in capital expenditures in 2026. The company is prioritizing AI data center chips and phasing out its consumer-focused Crucial brand. Despite the favorable outlook, challenges persist, including balancing supply of high-margin chips with those less profitable for strategic clients. J.P. Morgan analysts have pointed out the difficulty in meeting the surging demand while maintaining profitability.
