Micron Technology (NASDAQ:MU) shares continued their upward momentum on Friday, rising 4.30% in premarket trading to $912.24, following a remarkable 18.36% surge the previous session. The stock's rally comes as fresh signals from major industry players point to a deepening memory supply crunch that extends beyond the data center and into consumer devices.
Samsung Electronics (KRX:005930) has forecast that supply shortages will persist until 2028, while Apple (NASDAQ:AAPL) has reported that its outlook is being impacted by component constraints and rising memory prices. These developments have reinforced investor confidence in Micron's pricing power and profitability.
Micron's fiscal third-quarter results underscored the strength of its diversified business. The Mobile and Client segments posted an 87% gross margin, matching the Core Data Center segment's performance. Notably, non-data center units accounted for 39% of revenue from business units, highlighting the breadth of the company's earnings base.
Friday's premarket activity saw Micron trade as high as $914, just 0.9% below last week's close but still 27.3% under its 52-week high of $1,255. The week's relatively small net change belied significant intraweek volatility: after closing at $920.95 on July 24, shares plunged 19.8% to $739.00 by July 29, only to rebound sharply on Thursday to $874.66.
The company's fiscal Q3 results revealed robust performance across all business units. Cloud Memory generated $13.77 billion in revenue with 83% gross margin, while Core Data Center and Mobile and Client each contributed $11.52 billion with 87% gross margins. Automotive and Embedded added $4.63 billion with a 79% margin. Cloud and Core Data Center together made up 61% of total business-unit revenue, but the other segments' strong margins are broadening the earnings base.
Samsung's memory business head, Jaejune Kim, noted that "almost all customers are requesting multi-year supply contracts," with the company aiming for agreements covering roughly two-thirds of its memory production. These contracts typically last at least five years and often include minimum price terms. Apple CEO Tim Cook described the constraints as "very significant" and said the company is exploring alternative memory sources.
The pricing leverage is evident in Micron's financials: the company reported an 84.6% GAAP gross margin for fiscal Q3 and guided to approximately 86% for fiscal Q4, with revenue expected around $50 billion. Management cited the "strategic value of memory in the AI era" as a key driver.
However, risks remain. Apple is considering other suppliers, and SK hynix (KRX:000660) plans to boost 2026 capital spending by about 50%, which could accelerate supply. Market analyst Kim Seok-hwan expressed doubts about the longevity of record margins. In Seoul, Samsung slipped 0.7% while SK hynix fell 5.6%, reflecting divergent views on the cycle's sustainability.
Investors will be watching Friday's cash-session close to see if Micron can hold above $900, a level that would keep it significantly below its annual high. The coming week will be crucial in assessing whether contract pricing can offset potential weakness in device demand.
