NEW YORK, July 21, 2026, 12:05 p.m. (EDT)
- The U.S. markets were trading; Micron shares rose 10.4% to $955.79.
- The PHLX Semiconductor Index rose 4.9%. Micron stayed 23.8% under its June peak.
- Alphabet NASDAQ:GOOGL is set to report on Wednesday, drawing attention once again to investments in AI.
Micron Technology, Inc. NASDAQ:MU gained 10.4% to $955.79 by midday Tuesday, spearheading a widespread recovery among memory and semiconductor stocks.
The PHLX Semiconductor Index rose 4.9%. The S&P 500 was up 0.8%, and the Nasdaq increased by 1.3%.
Despite Tuesday’s surge, Micron was still trading nearly 24% beneath its June 25 peak. This ongoing shortfall continues to center attention on questions about the sustainability of its profits.
A quick estimate values the shares at 7.7 times annualized non-GAAP earnings for the fourth quarter, based on Micron’s $31 guidance midpoint and the midday share price.
The number is based on annualizing a single quarter and should not be seen as a projection for the entire year.
The low multiple aligns with projections for reduced earnings in the future. Micron, on the other hand, predicted additional sequential improvements in fiscal Q4.
| Metric | Fiscal Q3 actual | Fiscal Q4 outlook midpoint | Sequential change |
|---|---|---|---|
| Revenue | $41.46 billion | $50.0 billion | Up 20.6% |
| Non-GAAP gross margin | 84.9% | About 86% | Increase of 1.1 percentage points |
| Non-GAAP diluted EPS | $25.11 | $31.00 | Up 23.5% |
The company outlook provides the Q4 numbers. Percentage differences are calculated from midpoint projections.
Micron reported adjusted free cash flow of $18.3 billion for the quarter. The company’s total cash, investments and restricted cash amounted to $30.2 billion.
Micron said customers made commitments totaling $22 billion across 16 strategic supply agreements. The company disclosed approximately $100 billion in remaining performance obligations.
Chief Executive Sanjay Mehrotra said in June, “We expect tight conditions to persist beyond calendar 2027.” He pointed to demand from AI and ongoing structural supply constraints. Reuters
Analysts at Morgan Stanley NYSE:MS described the latest selloff as “a strong entry point.” They noted that memory prices climbed 25% this quarter. Investopedia
Alphabet is set to deliver its report on Wednesday, serving as the next gauge of demand. “We need to hear from hyperscalers like Alphabet reaffirming their CapEx spending plans,” said Art Hogan of B. Riley Wealth. Reuters
Shares in SK hynix KRX:000660 advanced 4.1% in Seoul on Tuesday. Chairman Chey Tae-won described prevailing prices as “abnormal,” but noted demand may surpass supply into 2027. Barron’s
Risks: Memory prices and Micron’s margins could decline if supply increases more quickly. Reduced spending by hyperscalers or lower memory usage per AI rack would also create challenges.
Tuesday’s gains reduced the valuation disparity but left the duration of the guided earnings pace unresolved.
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