Micron forecasts revenue above estimates on AI-driven memory chip demand

Micron Technology forecast fourth-quarter revenue above Wall Street estimates on Wednesday on robust demand for its high-bandwidth memory (HBM) chips used in artificial intelligence data centers.

The memory chip maker reported a nearly 50 per cent jump in third-quarter sales of its HBM chips from the previous three months, and said it will continue to invest in the chips. 

The results and the investment plans underscore a rise in demand for AI chips such as those from Nvidia and Advanced Micro Devices, both of which use Micron's memory chips.

Many cloud companies, such as Google, have committed large investments this year toward AI infrastructure expansion, which underlines strong demand for AI-related products.

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The extent of tariff-related pull-ins from customers in the third quarter was fairly modest, Micron Chief Business Officer Sumit Sadana told Reuters.

"So that's not something we lose sleep over," Sadana said, adding that he sees healthy demand for the second half of the calendar year.

Micron also expects its market share in HBM chips would grow to match its overall share for dynamic random access memory (DRAM) chips sometime in the second half of calendar 2025.

The company is one of the providers of high-bandwidth memory chips, besides South Korea's SK Hynix and Samsung.

In April, Micron introduced a new business segment, called "cloud memory business unit", which will focus on products used by hyperscalers, as well as HBM chips that help perform data-intensive AI tasks quickly.

Micron said it expects fourth-quarter revenue of $10.7 billion, plus or minus $300 million, compared with analysts' average estimate of $9.88 billion, according to data compiled by LSEG.   

For the third quarter, Micron reported revenue of $9.30 billion, compared with estimates of $8.87 billion.

Excluding items, earnings per share stood at $1.91, above analysts' average estimate of $1.60.