Micron reported $54.23B in revenue and an 87.0% gross margin. It then guided next quarter’s revenue to $60B to $63B.
Those are strong numbers. The harder question is how long memory supply stays tight while the industry builds more capacity.
Micron’s Forecast Meets a Long Capacity Build
Micron’s Q4 FY26 revenue beat the $50.9B estimate. Adjusted earnings per share were $33.42, above the $31.49 estimate, and gross margin beat the 86.3% estimate.
For Q1 FY27, Micron expects adjusted earnings per share of $37.15 to $39.15 and approximately 86.25% non-GAAP gross margin. It expects fiscal 2027 to be another record year, with revenue rising each quarter. Management expects Q1 to be the low point for gross margin.
Cloud Memory and Core Data Center brought in $34.28B, or 63% of revenue. Micron says memory and storage supply will be “much tighter” in fiscal 2027 and 2028 than in 2026.
Customers have made longer commitments, too. Micron has 26 strategic customer agreements covering an estimated 35%+ of revenue through 2030, with some extending into 2031. Customer financial commitments have reached $32 billion.
A source says much of Micron’s $40B+ in capital spending is going into buildings and cleanrooms. New supply will take years to arrive. That helps explain how Micron can spend heavily on capacity while still expecting tight supply.
CFO Michael Murphy said Micron has “the ability and the intent to increase our capital return.” He expects the company to seek a larger authorization and begin stronger capital returns from December 9th. He gave no buyback amount.
Bonds, Inflation, Oil and Trade
The Treasury said it would buy back $6bn of government debt. That was above its earlier plan to at least double long-term bond purchases to $4bn, but below the $8bn and $10bn figures analysts had discussed.
Bond selling returned in the United States, France and Japan, according to Reuters. The FT reported the 10-year Treasury yield just below 4.86 per cent. A separate October 1 market note said it briefly reached about 5.34%. The two accounts give different levels.
Another report said foreign investors withdrew ¥1.34 TRILLION from Japanese bonds last week, after adding ¥2.24 TRILLION the week before. In the U.S., the average 30-year fixed mortgage rate rose to 7.28%.
Inflation readings were mixed. The October 1 note put August headline PCE at 3.4% year over year, below the 3.7% expected. Core PCE was 3%. A measure of factory prices paid rose to 77.9 from 71.1, while initial jobless claims were 197,000. Fed officials said they could wait before the next rate move. The note identified Friday’s September jobs report as the next test.
The same note put Brent near $102 and WTI near $93, and said higher energy prices were feeding inflation and the bond selloff. Stock Talk, citing the Wall Street Journal, said crude exports through the Gulf had recovered to 13 million barrels per day, versus 19 million before the war. A reply questioned whether Gulf producers had arranged with Iran to let tankers pass. That question was unresolved.
President Trump renewed a threat to stop trading with countries that have surpluses with the U.S. unless the Fed cuts rates, and named Canada. After he said Bombardier must build in America to access the U.S. market, Bombardier pointed to direct employment in more than 20 states and sites in 10. Canada had imposed retaliatory tariffs on about $20 billion of U.S. goods, matching the latest U.S. import taxes on Canadian products.
Separately, a speaker at @geopoliticaleconomyreport alleged that U.S. officials threatened foreign governments and pressured Europe to buy U.S. LNG. He cited an alleged March 2026 warning to Greek officials and made further claims about Venezuela and Cuba.
AI Spending Brings New Claims About Tech Stocks
WOLF, citing the FT, said Tencent committed roughly $7B to Oracle for access to about 100,000 advanced AI chips across Southeast Asia over five years. About 30% is to be paid upfront.
Meta introduced Muse, a personal AI agent with a free tier and plans priced at $20 or $100 a month. Meta says it can handle appointments, forms and home security camera monitoring. It says Muse asks before sensitive actions. Users must opt out if they do not want their interactions used to train Meta’s AI models.
Meta faces pressure to show returns on its AI spending, along with privacy and safety scrutiny. FindleysFinance estimated Meta’s fair value at $1,133 and calculated +53% upside from a $738 share price. That estimate used 18% annual operating cash flow growth. Meta’s heavier capital spending raises the question of whether that growth assumption holds.
Bloomberg News said Anthropic is seeking to go public as soon as the middle of November, according to people familiar with the matter. Bourbon Capital separately claimed Amazon owns about 17% of Anthropic and that Anthropic is seeking a $2T valuation.
An AVGO post called the stock cheap after a 26% decline from its earlier high. It cited +85.5% year-over-year revenue growth, Q4 guidance of 34.8b and a 20x forward P/E. “Cheap” is that post’s judgment.
Index Gains Hide a Harder Question
Bull Theory said the Nasdaq 100 closed the month above 30,400 at a record high. Eigenvalue said 75% of S&P stocks finished down. The October 1 note put the S&P 500 up about 0.2% at 7,666, with the Dow and Nasdaq roughly flat. The index headlines and the reported stock breadth describe different parts of the market.
Fidelity reported a 10.5% rise in the average 401(k) balance from March through June. Average balances were $75,200 for participants in their 30s and $156,800 for those in their 40s. Participants saved an average 14.4% of pay, including employer contributions.
A value investing speaker warned younger investors against taking more risk to chase AI winners. He argued that lasting winners are hard to pick, citing a 76% Nasdaq fall after the dotcom bubble and saying the index was still down 70% nine years later.
Gublo called Micron undervalued and cited a PEG of 0.04, but warned that memory shortages can lead to added capacity and then a glut. Micron expects much tighter supply in fiscal 2027 and 2028, while its new capacity will take years to arrive. Its results and forecast are strong. The risk from added memory capacity remains unresolved.