Micron Technology’s (MU) Q3 2026 earnings report landed on June 24, giving the AI trade a badly needed jolt.
Goldman Sachs had cautioned that the positioning was bullish, expectations were high, and the stock’s huge run left little room for disappointment.
Then Micron delivered more than a beat.
Revenue, margins, and guidance came in well above consensus, while management outlined long-term customer agreements that could make the memory cycle appear less volatile than Wall Street once assumed.
As noted in TheStreet’s live blog, covered by tech reporter Noah Weidner, the reaction was immediate.
According to Reuters, Micron shares jumped nearly 12% in extended trading after it pointed to booming AI memory demand and a whopping $22 billion in customer commitments to secure chip supply. As of this writing, Micron’s stock price is $1,048 per share.
On top of that, the read-through spread quickly across memory and chip stock names. Western Digital, Sandisk, and Seagate all jumped over 8% after hours, while Arm gained about 6%, Marvell rose nearly 4%, and Broadcom added 2%.
Nevertheless, Goldman stayed cautious.
According to TheFly, 5-star analyst James Schneider bumped his price target on the back of Micron’s earnings power yet kept a Neutral rating.
That split is the story: Goldman sees stronger fundamentals, tighter supply, and better visibility but also worries that the rally may already reflect much of the good news.
Micron Q3 earnings at a glance
- Micron’s Q3 revenue surged to $41.46 billion, beating the consensus of $35.82 billion by $5.64 billion, driven by strong AI memory demand.
- Non-GAAP earnings came in at $25.11 per share, well above the $20.71 consensus estimate, marking a $4.40 earnings beat.
- For Q4, Micron guided revenue of $49 billion to $51 billion, with the $50 billion midpoint topping consensus by $6.55 billion.
- Q4 non-GAAP EPS guidance of $30 to $32 also came in sharply above the $25.43 consensus, while gross margin is expected to be near 86%.
- Management highlighted AI-driven strength in DRAM and HBM pricing, with operating cash flow rising to $25.4 billion and free cash flow reaching $18.3 billion.
Source: Micron Investor Relations.
Why Goldman raised Micron’s target but refused to chase the rally
Goldman Sachs is essentially bullish on Micron’s business but remains disciplined on the stock.
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Analyst James Schneider lifted the firm’s price target to $1,100 from $900 after Micron delivered a much stronger quarter and guidance that came in well ahead of Wall Street.
The upgrade to the target reflects better earnings power, stronger visibility, and a memory market that remains unusually tight.
Micron’s customer agreements drove the increase in the price target.
The company has signed 16 agreements across end markets, covering about 20% of anticipated DRAM volume and 30% of NAND volume. Over time, Micron expects these deals to account for roughly half of its revenue.
Still, Goldman did not move to Buy because of valuation and timing.
Schneider sees the stock’s risk-reward as roughly balanced after a huge run. The fundamentals are stronger, but the market has already moved aggressively to price in AI demand, tight supply, and better margins.
For perspective, according to Seeking Alpha, Micron stock is trading at 23 times non-GAAP earnings, 30% above its 5-year average.
Goldman also warns that supply additions are still coming. The firm does not expect meaningful market slack until 2028 at the earliest, but it wants proof that industry supply discipline can hold through 2028 and beyond.
Wall Street price targets for Micron stock
- Susquehanna raised Micron to $2,000 from $1,750 and maintained a positive rating (post-earnings).
- KeyBanc raised Micron to $1,600 from $600, with an Overweight rating (post-earnings).
- Bank of America raised Micron to $1,550 from $1,500, with a Buy rating (post-earnings).
- JPMorgan raised Micron to $1,540 from $550, an Overweight rating (post-earnings).
- RBC Capital raised Micron to $1,500 from $1,200 and maintained an Outperform rating (post-earnings).
- Goldman Sachs raised Micron’s price target to $1,100 from $900 and maintained a Neutral rating (post-earnings).
Sources: Investing.com, Yahoo Finance.
Sanjay Mehrotra says Micron’s AI story is bigger than one quarter
CEO Sanjay Mehrotra had plenty to say about Micron delivering another stunning earnings print.
The overarching theme was that AI has fundamentally transformed the entire memory business, as reported by Investing.com.
He said, “The memory industry has been structurally transformed by the proliferation of AI.” Mehrotra framed memory as a strategic asset for AI systems, not a commodity input that ebbs and flows with PC or smartphone demand.
The supply side was just as important.
Mehrotra said customers understand that memory shortages will take time to fix, because new fabs are large, complex, and slow to build. He pointed to long construction timelines. skilled-worker shortages, energy needs, and more complicated process technology as barriers to entry.
That’s why the strategic customer agreements matter.
Micron completed 16 such deals across data center, consumer, and auto markets. Mehrotra said they provide contracted supply assurance, deepen customer partnerships, and could eventually put roughly 50% or more of company sales under these agreements.
He also tied the story to tech leadership.
Micron’s 1-gamma DRAM and G9 NAND nodes are ramping, while HBM4 12-High is tracking twice as fast as HBM3E 12-High. Micron has already shipped more than $1 billion in HBM4 revenue.
Mehrotra also widened the demand argument beyond data centers and said that,
“AI system performance is architecturally dependent on memory subsystem performance and capacity.”
Related: Morgan Stanley pulls no punches after tech stock sell-off
