CEO Sanjay Mehrotra reveals customers failed to predict AI-driven memory demand, prompting record capex despite prior losses.
Micron Technology will spend $200 billion to expand production after AI-driven demand surged beyond customer forecasts. The company reported a $41.46 billion quarterly revenue in Q3 FY2026, up from a $15.54 billion fiscal 2023 collapse that included a $5.83 billion net loss.
Despite a 39-analyst consensus price target of $1,454, Micron trades at a 7x forward P/E, reflecting skepticism over its cyclical recovery. CEO Sanjay Mehrotra told investors the supply gap for DRAM is the worst in history, with Micron able to fulfill only 50-67% of key customer demand.
The company invested $10 billion in 2023 while competitors cut capex, positioning itself for the AI memory boom. Gross margins turned negative during the downturn, but operating leverage is now driving rapid recovery.