Micron Rides on DRAM Demand Wave: Can the AI Boom Keep Aiding Growth?

Core Insights - Micron Technology, Inc. is experiencing significant growth in its DRAM business, with revenues increasing by 51% year over year and 15% sequentially to $7.1 billion in Q3 of fiscal 2025, representing 76% of total revenues of $9.3 billion [1][8] - The demand for DRAM is being driven by the AI boom, as high-performance servers require large amounts of DRAM for complex workloads, positioning Micron as a key supplier with its high-capacity and power-efficient LPDRAM [2][8] - Micron anticipates continued growth in DRAM bit demand in the high teens for 2025, with expectations of improved pricing and cost efficiencies enhancing gross margins [3] Financial Performance - The Zacks Consensus Estimate for Q4 DRAM revenues is projected at $8.69 billion, indicating a robust 63% year-over-year increase and a 23% sequential rise [4][8] - Micron's shares have increased approximately 40.8% year to date, outperforming the Zacks Computer – Integrated Systems industry's gain of 25.4% [7] - The forward price-to-sales ratio for Micron is 3.58, slightly above the industry average of 3.46 [9] Earnings Estimates - The Zacks Consensus Estimate for Micron's fiscal 2026 earnings suggests a year-over-year increase of about 62.4%, with upward revisions in estimates over the past 30 days [10] Competitive Landscape - While there are no direct U.S. stock exchange-listed competitors in the memory chip space, companies like Intel and Broadcom play significant roles in the AI hardware ecosystem, which could impact Micron's market position [5][6]