Micron's Revenue Tripled, HBM Is Sold Out, and $25 Billion Still Won't Close the Gap

Micron's entire high-bandwidth memory output for 2026 is pre-sold, driving a historic stock surge to $1 trillion. Massive capex of $25B won't ease supply until 2028, locking in long-term contracts with hyperscalers.

The narrative around Micron Technology has shifted from cyclical memory supplier to structural AI bottleneck. The proof lies in a single number: the company's entire high-bandwidth memory (HBM) output for the rest of 2026 is already spoken for. That kind of demand visibility has sent Micron's stock on a tear — it briefly crossed $1 trillion in market capitalization at the end of May, becoming the 11th most valuable US company, after covering the distance from $500 billion in just 48 trading sessions.

But behind the share price rally lies a supply deficit that even the most aggressive capital spending in the company's history cannot quickly fix. Micron has raised its capex for fiscal 2026 to more than $25 billion, an increase of $5 billion from the prior plan and a jump of over $10 billion from last year. The money is being spread across three continents: a new two-story NAND wafer fab in Singapore devoted to AI data centers, the ramping of 1-alpha DRAM production in Manassas, Virginia — which will quadruple DDR4 capacity for automotive and industrial uses — and expanded packaging and testing facilities in Malaysia. The effort will create roughly 3,000 jobs in packaging, fab engineering, and automation.

Yet even with this spending spree, Micron does not expect meaningful new capacity to reach the market before the end of 2027, with a full ramp following only in 2028. The leadership team describes the supply-demand gap as historically wide. Hyperscalers can currently secure only about 60% of the memory they need. To lock down pricing and reduce exposure to the volatile spot market, Micron has signed long-term fixed-price contracts with major cloud providers. UBS analyst Timothy Arcuri called those agreements transformative, raising his price target from $535 to $1,625 — more than tripling it — and forecasting earnings per share of $155 for fiscal 2027 and $167 for fiscal 2028. Susquehanna's Mehdi Hosseini followed suit on June 1, lifting his target from $600 to $1,750 in a single move.

The demand surge is not limited to HBM. The shift from AI model training to inference — the day-to-day execution of finished models — is boosting demand for conventional DRAM and NAND flash as well. Nvidia's upcoming Vera-Rubin GPU platform will require 288 GB of HBM, more than triple the 80 GB used in the H100 generation. Industry data suggests the DRAM market could expand by 303% to nearly $619 billion in 2026, while NAND could grow 280%.

Micron's financials already reflect the acceleration. In the fiscal second quarter, revenue nearly tripled year over year to $23.9 billion — the secondary article says 196% increase to $23.9B, primary says $23.86B; use $23.9B for consistency. Earnings per share landed between $18.75 and $19.55. For the third quarter, due June 24, management has guided revenue of $32.8 billion to $34.3 billion, with EPS in a similar range. The stock currently trades at around €833 to €862 (depending on the exchange), up roughly 210% to 220% year to date, and sits at a 52-week high.

Political tailwinds are also at play. The Trump administration is reportedly exploring a direct state stake in Micron to secure domestic chip supply, on top of the $6.1 billion already awarded under the CHIPS Act for fabrication sites in Idaho and New York.

Not everyone is convinced the capex splurge carries no risk. Some investors question whether a $25 billion expansion could eventually create an oversupply. For the near term, however, the calculus is plain: demand for high-performance memory is largely price-inelastic and growing faster than any new fab can come online. Micron's forward P/E of roughly 10 on 2026 earnings estimates is well below the S&P 500 technology sector average — a discount that analysts argue fails to price in the structural transformation now underway.