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Micron's AI Storage Surge
3 Apr
Summary
- Micron's NAND revenues soared 169% year over year.
- AI workloads are driving demand for high-performance storage.
- Micron's stock trades at a forward P/E ratio of 4.22.
Micron Technology's NAND business is poised for substantial growth, largely propelled by the escalating demand stemming from artificial intelligence (AI) workloads. The increasing need for rapid data access in AI models has intensified the requirement for advanced storage solutions, particularly within data centers.
In the second quarter of fiscal year 2026, Micron reported a remarkable 169% year-over-year surge in NAND revenues, reaching $5 billion. This impressive performance was primarily attributed to the robust demand for its data center solid-state drives (SSDs). The company's SSD market share has also seen consistent growth, marking its fourth consecutive annual increase in 2025.
The NAND market currently faces a supply shortage, with limited immediate capacity expansions expected. This dynamic, coupled with Micron's planned expansions that will take time to materialize, suggests that favorable pricing conditions could persist through fiscal year 2027. Consequently, Micron's NAND growth outlook is bolstered by both strong demand and supportive pricing.
From a valuation perspective, Micron Technology presents an attractive profile, trading at a forward price-to-earnings ratio of 4.22, which is significantly lower than the industry average. The Zacks Consensus Estimate indicates substantial year-over-year increases in both fiscal year 2026 and 2027 revenues, with the NAND segment projected to constitute a significant portion of the total revenue.
