NEW YORK, July 21, 2026 – Micron Technology (NASDAQ:MU) shares rallied 10.4% to $955.79 by midday Tuesday, leading a broad recovery in semiconductor stocks. The PHLX Semiconductor Index advanced 4.9%, while the S&P 500 gained 0.8% and the Nasdaq rose 1.3%.
Despite the sharp single-day move, Micron still trades approximately 24% below its June 25 peak, keeping the spotlight on the sustainability of its earnings trajectory. At the current price, the stock is valued at roughly 7.7 times annualized non-GAAP earnings for the fourth quarter, based on the company’s $31 guidance midpoint. That multiple, derived from a single quarter’s annualization, is not a forecast for the full year but reflects expectations of lower earnings ahead.
Micron’s fiscal fourth-quarter outlook calls for revenue of $50.0 billion, up 20.6% sequentially from $41.46 billion in Q3. Non-GAAP gross margin is projected at about 86%, compared with 84.9% in the prior quarter, while non-GAAP diluted EPS is expected to rise 23.5% to $31.00 from $25.11. The company also reported adjusted free cash flow of $18.3 billion for the quarter and total cash, investments, and restricted cash of $30.2 billion.
Customer commitments totaled $22 billion across 16 strategic supply agreements, and Micron disclosed approximately $100 billion in remaining performance obligations. Chief Executive Sanjay Mehrotra reiterated in June that tight supply conditions are expected to persist beyond calendar 2027, driven by AI demand and structural constraints.
Morgan Stanley analysts described the recent selloff as “a strong entry point,” noting that memory prices climbed 25% this quarter. Meanwhile, attention is turning to Alphabet’s (NASDAQ:GOOGL) earnings report on Wednesday, which will serve as a key gauge of AI-related capital expenditure. “We need to hear from hyperscalers like Alphabet reaffirming their CapEx spending plans,” said Art Hogan of B. Riley Wealth.
In Asia, SK hynix (KRX:000660) shares rose 4.1% in Seoul. Chairman Chey Tae-won described prevailing prices as “abnormal” but indicated demand may outstrip supply into 2027.
Risks to the outlook include a potential increase in memory supply that could pressure margins, as well as reduced spending by hyperscalers or lower memory usage per AI rack. Tuesday’s gains narrowed the valuation gap but left questions about the duration of the guided earnings pace unanswered.
