Micron Technology: Can the Stock Double Again?
Micron Technology (MU) stock has been on a red-hot streak in 2025, nearly doubling in value year-to-date. This impressive performance is largely attributed to the company's robust revenue and earnings growth.
Micron is capitalizing on the burgeoning demand for memory chips used in data centers to power Artificial Intelligence (AI) workloads. Simultaneously, the company is poised to benefit from the increasing memory content in smartphones and personal computers (PCs), which are being equipped with larger memory chips to execute AI tasks locally.
Therefore, it wouldn’t be surprising to see Micron emulate its outstanding stock market performance in the coming year. Let's examine the factors that contribute to this semiconductor stock's potential for another significant leap.
Micron Technology Poised for Another Year of Strong Growth
Micron reported its fiscal 2025 fourth-quarter results (for the year ended August 28th) on September 23rd. The company concluded the fiscal year with a remarkable 49% year-over-year increase in revenue, reaching $37.4 billion. Furthermore, its non-GAAP earnings surged by an impressive 537% year-over-year to $8.29 per share.
Micron's stock surge in 2025 appears justified, with AI playing a critical role in driving these strong results. The company's revenue from High Bandwidth Memory (HBM), high-capacity Random Access Memory (RAM), and server Dynamic Random Access Memory (DRAM) sales increased more than fivefold in fiscal 2025, reaching $10 billion.
Notably, these chips are increasingly being deployed in data centers, where high-performance, large-capacity memory is essential for supporting AI workloads like model training and inference applications. The good news is that the demand for AI-capable memory chips, such as HBM, is projected to continue growing.
Goldman Sachs forecasts a 23% increase in demand for HBMs used in Graphics Processing Units (GPUs) in 2026. Furthermore, HBM deployed in Application-Specific Integrated Circuits (ASICs) is expected to grow at an even faster rate of 82% next year, representing one-third of the total HBM market.
Additionally, the average selling price (ASP) of HBM is projected to increase by 18.5% in 2026. This combination of higher volumes and prices should pave the way for significant growth in the HBM market in the coming year. Micron is well-positioned to capitalize on this HBM market growth in 2026. According to CEO Sanjay Mehrotra on the company's recent earnings conference call:
"Our HBM customer base has expanded and now includes six customers. We have pricing agreements with almost all customers for a vast majority of our HBM3E supply in calendar 2026. We are in active discussions with customers on the specifications and volumes for HBM4, and we expect to conclude agreements to sell out the remainder of our total HBM calendar 2026 supply in the coming months."
Consequently, Micron is likely to sell its entire HBM capacity for next year soon, despite adding new capacity to meet rising demand. This should ensure another year of robust growth for the company's HBM business.
However, Micron's AI-driven memory opportunity extends beyond data centers in 2026. Market research firm Gartner estimates a 32% increase in sales of generative AI smartphones next year. Similarly, AI-enabled PCs could see a significant 60% jump in revenue. Micron management highlights that these AI-enabled devices are equipped with increased compute memory.
The growing adoption of AI smartphones and PCs should provide a substantial boost to Micron's addressable market in 2026. This explains the company's optimistic guidance for the current quarter, which could pave the way for further stock price appreciation in the coming year.
How the Stock Could Double Again
Micron anticipates earnings of $3.75 per share in fiscal Q1 on revenue of $12.5 billion at the midpoint of its guidance range. This would translate to a 44% year-over-year increase in revenue and a more than doubling of earnings to $3.75 per share. Analysts expect Micron to sustain its earnings growth rate throughout the year.
Consensus estimates project a doubling of earnings in the new fiscal year to $16.30 per share, which appears achievable given the combination of increasing memory prices and volumes. Assuming Micron achieves this milestone and trades at 22 times earnings after a year (consistent with its trailing price-to-earnings ratio), its stock price could potentially reach $359.
This would represent more than double its current stock price. Furthermore, investors should note that Micron trades at a substantial discount to the tech-heavy Nasdaq-100 index's earnings multiple of 33. Given the potential for the market to reward Micron with a higher earnings multiple due to its strong growth, there is a good possibility that this AI stock could double again in the coming year.
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