New Delhi, India, December 18, 2025 – Micron forecasts strong earnings as artificial intelligence demand drives memory chip sales to record highs. Analysts say the outlook signals growing strength in the semiconductor industry.
The company projected adjusted earnings of $8.42 per share, plus or minus 20 cents, beating expectations of $4.78 per share, according to LSEG data. Rising memory chip prices and limited supply contributed to this increase. Shares of Micron climbed 7% in after-hours trading, showing investor trust in the company’s AI-focused strategy.
Micron also raised its revenue estimate for the current quarter to $18.70 billion, plus or minus $400 million. Analysts had predicted roughly $14.20 billion, making this guidance a substantial surprise. Last quarter, the company reported $13.64 billion in sales and $4.78 per share in adjusted profit, exceeding forecasts.
Demand growth stems mainly from AI data centers, which require high-performance memory for training and operating generative AI models. Micron is one of three major suppliers of high-bandwidth memory chips, alongside Samsung Electronics and SK Hynix. Limited availability has intensified competition among tech firms.
CEO Sanjay Mehrotra stated that memory supply will remain tight past 2026. The company expects to fulfill only half to two-thirds of key customer orders in the near term. This shortage emphasizes the importance of long-term contracts. Micron is negotiating multiyear agreements to maintain its position in the AI market.
To meet rising demand, Micron plans to boost 2026 capital spending to $20 billion, up from $18 billion. These funds will expand production and strengthen the company’s ability to supply AI-focused chips. Experts believe this move could improve margins and enhance market competitiveness.
Analysts highlight AI as the main driver behind Micron’s performance. Kinngai Chan from Summit Insights said, “AI-related demand remains the key growth engine for Micron.” The company is shifting production toward AI data centers while reducing consumer-facing operations. Earlier this month, it announced discontinuation of memory chip sales under the Crucial brand.
The shift mirrors wider industry trends. Cloud service providers continue investing heavily to support AI applications, creating steady memory chip demand. Micron’s production capacity ensures it can benefit significantly from this transformation.
Jacob Bourne, an analyst at eMarketer, noted that Micron’s approach aligns with market realities. “Micron will remain among the winners as AI demand rises,” he said. High-bandwidth memory focus allows the company to meet advanced computing needs efficiently.
Micron’s strong forecast suggests optimism for the broader semiconductor market, which has experienced volatility in recent years. Moreover, AI is transforming technology, making memory chips essential. Therefore, strategic investments and partnerships indicate Micron is prepared to lead in this evolving landscape.
As demand continues, supply limitations may still persist, creating challenges for device makers and cloud providers. However, Micron’s guidance therefore reflects confidence in sustaining robust growth and navigating market pressures.
