Stock Track | Micron Stock Soars on Strong Al Demand and Robust Outlook.

Shares of Micron Technology $Micron Technology (MU.US)$ surged over 15% on Thursday after the memory chipmaker reported fiscal fourth-quarter earnings that crushed Wall Street's expectations. Micron's strong results were fueled by robust demand for its artificial intelligence (AI) products, particularly in the data center segment.

For the quarter ended August 29, Micron posted revenue of $7.75 billion, a 93% year-over-year increase that topped analysts' estimates of $7.64 billion. The company reported adjusted earnings per share of $1.18, well above the consensus forecast of $1.11. Micron's NAND revenue hit a quarterly record buoyed by solid data center SSD sales exceeding $1 billion.

CEO Sanjay Mehrotra expressed optimism about Micron's competitive positioning, stating "We are entering fiscal 2025 with the strongest competitive positioning in Micron's history." He cited the company's leadership in advanced DRAM and NAND process technologies as key drivers.

Looking ahead, Micron provided an upbeat forecast for the current quarter. The company expects revenue of around $8.7 billion, plus or minus $200 million, which topped analysts' estimates of $8.3 billion. Micron also guided for an adjusted gross margin of 39.5%, above the 37.7% analyst consensus.

The strong results and guidance highlight Micron's success in capitalizing on the booming demand for memory chips and storage solutions used in AI applications, especially data centers. Micron's high-bandwidth memory (HBM) products are critical components in AI computing, and the company stated it has already sold out HBM capacity through calendar 2025 at contracted prices.

Analysts were bullish on Micron following the earnings report, with several firms raising their price targets. Rosenblatt increased its target to $250, implying over 120% upside potential from current levels, while Bank of America raised its target to $125.

The surge in Micron shares helped lift the broader semiconductor sector on Thursday, with the Philadelphia Semiconductor Index rising over 3%. Investors are increasingly optimistic about the prospects for chip companies exposed to the rapidly growing AI market.