Micron Tech: AI-Driven Growth Aims to Lift Stock Post June 25 Earnings

Published Date : 08/06/2025 

Micron Technology's stock has surged 37% in recent months, and the company's upcoming Q3 earnings report on June 25 is anticipated to provide further momentum. The company's focus on high-bandwidth memory (HBM) for AI applications is a major catalyst. 

Micron Technology (MU) stock has made a significant move higher over the past couple of months, gaining an impressive 37% as of this writing. This surge is largely driven by the broader recovery in technology stocks. It won't be surprising to see this semiconductor stock get a big boost when it releases its fiscal 2025 third-quarter results after the market closes on June 25.

Micron is heading into its quarterly report with a major catalyst in the form of artificial intelligence (AI), which could allow the company to deliver better-than-expected numbers and guidance, potentially sending its stock even higher. Let's delve into the reasons why this might be the case.

Micron is Set to Deliver Terrific Growth Thanks to AI

Micron's fiscal Q3 guidance calls for $8.8 billion in revenue at the midpoint of its guidance range. This would be a substantial increase over the year-ago period's revenue of $6.8 billion. Meanwhile, the company's adjusted earnings are forecast to jump by just over 2.5 times on a year-over-year basis. However, the booming demand for high-bandwidth memory (HBM) used in AI graphics processing units (GPUs) manufactured by companies like Nvidia and AMD could allow Micron to exceed its guidance.

Micron's HBM has been selected for powering Nvidia's GB200 and GB300 Blackwell systems, and the good news is that the latter reported solid numbers recently. Nvidia's data center revenue shot up 73% year over year to $39 billion in the first quarter of fiscal 2026, with the Blackwell AI GPUs accounting for 70% of the segment's revenue. Nvidia pointed out that it has almost completed its transition from the previous-generation Hopper platform to GPUs based on the latest Blackwell architecture. Notably, the company's Blackwell GPUs are equipped with larger HBM chips to enable higher bandwidth and data transmission.

Specifically, Nvidia's Hopper H200 GPU was equipped with 141 gigabytes (GB) of HBM. This has been upgraded to 192 GB on Nvidia's B200 Blackwell processor, while the more powerful B300 packs a whopping 288 GB of HBM3e memory. Micron management remarked on the company's March earnings conference call that it started volume shipments of HBM3e memory to its third large customer, suggesting that it could indeed be supplying memory chips for Nvidia's latest generation processors.

Importantly, the strong demand for HBM has created a favorable pricing scenario for the likes of Micron. The company is reportedly looking to hike the price of its HBM chips by 11% this year. It has sold out its entire HBM capacity for 2025 and is negotiating contracts for next year, and it won't be surprising to see customers paying more for HBM considering its scarcity.

This combination of higher HBM volumes and the potential increase in price explains why Micron's top and bottom lines are set to witness remarkable growth when it releases its earnings later this month. Additionally, even more chipmakers are set to integrate HBM into their AI accelerators. Broadcom and Marvell Technology, known for designing custom AI processors for major cloud computing companies, have recently developed architectures supporting the integration of HBM into their platforms.

Why It Would Be a Good Idea to Buy the Stock Before June 25

Micron stock has rallied impressively in the past couple of months. The good part is that the company is still trading at just 23 times earnings despite this surge. The forward earnings multiple of 9 is even more attractive, indicating that Micron's earnings growth is set to take off.

Consensus estimates are projecting a whopping 437% increase in Micron's earnings this year, followed by another solid jump of 57% in the next fiscal year. All this indicates why the stock's median 12-month price target of $130 points toward a 27% jump from current levels. However, this AI stock could do much better than that on account of the phenomenal earnings growth that it is projected to clock, which is why investors can consider buying it hand over fist before its June 25 report that could supercharge its recent rally. 

Frequently Asked Questions (FAQS): 

Q: What is HBM and why is it important for AI?

A: High-Bandwidth Memory (HBM) is a type of DRAM that provides significantly higher bandwidth and data transmission rates compared to traditional memory. It is crucial for AI applications because it allows for faster and more efficient processing of large datasets, which is essential for training and running complex AI models.

Q: What is Micron's fiscal Q3 revenue guidance?

A: Micron's fiscal Q3 guidance calls for $8.8 billion in revenue at the midpoint of its guidance range, representing a substantial increase over the year-ago period's revenue of $6.8 billion.

Q: How has Nvidia's data center revenue performed recently?

A: Nvidia's data center revenue shot up 73% year over year to $39 billion in the first quarter of fiscal 2026, with the Blackwell AI GPUs accounting for 70% of the segment's revenue.

Q: Why is Micron looking to hike the price of its HBM chips?

A: Micron is reportedly looking to hike the price of its HBM chips by 11% this year due to the strong demand for HBM, which has created a favorable pricing scenario. The company has sold out its entire HBM capacity for 2025 and is negotiating contracts for next year, and it won't be surprising to see customers paying more for HBM considering its scarcity.

Q: What are the projected earnings growth rates for Micron?

A: Consensus estimates are projecting a whopping 437% increase in Micron's earnings this year, followed by another solid jump of 57% in the next fiscal year. 

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