NEW YORK, June 26, 2026, 08:04 (EDT)
- Micron Technology, Inc. NASDAQ:MU dropped 5.4% in premarket trading Friday after shares soared 15.7% Thursday. Nasdaq 100 futures slipped 1.25%.
- The shares traded at $1,151.93 in premarket, about 9.3 times the company’s annualized fiscal Q4 non-GAAP EPS guidance of $31.
- Micron has 16 strategic customer agreements with roughly $100 billion in minimum-price revenue and $22 billion in deposits and financial commitments. Some of those agreements include price ceilings.
- BNP Paribas called the report “historic,” while Bernstein raised doubts about deal ceilings limiting upside, showing analysts are split. MarketWatch
Micron Technology, Inc. NASDAQ:MU fell in premarket trading Friday. Shares pulled back from a record run. The company gave profit guidance, but shares still traded at under 10 times annualized profit for the next quarter.
With Investing.com listing a premarket price of $1,151.93 and Micron’s Q4 non-GAAP EPS guidance at $31 midpoint, the stock traded at 9.3 times earnings. The Thursday close of $1,213.56 bumped that multiple to 9.8. That’s still low for a trillion-dollar chip name, unless Q4 ends up being the peak for memory.
Investors had numbers to work with after the company posted fiscal third-quarter revenue of $41.46 billion, way up from $9.30 billion a year ago. Non-GAAP EPS came in at $25.11. For the fiscal fourth quarter, Micron predicted revenue of $50.0 billion, give or take $1.0 billion, and a gross margin near 86%.
Micron surged 15.7% Thursday, its biggest jump after earnings on record, Dow Jones Market Data said. Shares hit $1,255 at the high, and the company picked up $186 billion in market cap.
Micron wiped out 5.4% in premarket Friday, according to Reuters, after jumping in the earlier session. Nasdaq 100 futures slid 1.25% as of 6:58 a.m. ET. Apple Inc. NASDAQ:AAPL also fell the previous day after it hiked prices on some products, citing higher memory and storage chip costs.
Contractually, Micron said it has 16 strategic customer deals that account for about 20% of DRAM volume and around a third of NAND volume during their terms. The company expects these types of agreements to cover about half or more of its revenue when all deals are finalized. CEO Sanjay Mehrotra said Micron still doesn’t “have line of sight” on when memory supply will balance with demand.
Micron’s $100 billion remaining performance obligation from signed deals is only double its fiscal Q4 revenue guidance. It’s not really about backlog size, but price terms. Most of the big contracts set floor and ceiling prices. Floor prices could help if the cycle turns down. Ceiling prices might limit upside if spot prices keep going higher.
Chief Financial Officer Mark Murphy called the RPO number “not indicative” of total future revenue and said customer deposits “will not affect our free cash flow.” Micron posted $18.3 billion in adjusted free cash flow for fiscal Q3 after net capital spending of $7.1 billion.
BNP Paribas analyst Karl Ackerman called the earnings report “historic” and said he was more confident the industry will remain undersupplied through next calendar year. Bernstein’s Mark Newman disagreed on the contract side, saying: “We wonder if the ceiling suggests limited headroom.” MarketWatch
Google Finance listed an average price target for Micron of $1,526.67 on Friday, with a low at $1,100. At the premarket quote, the average was roughly 33% above the stock. The low target was a little under the premarket price.
BMO Family Office CIO Carol Schleif summed up the risk Thursday: “it’s coming out of somebody else’s hide.” Reuters
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