Micron Technology announced on Wednesday that its upcoming quarterly revenue would exceed analyst expectations, driven by rising customer commitments under long‑term supply agreements totaling $32 billion. The company’s stock has more than tripled this year, pushing its market value past $1 trillion in May amid optimism about AI‑related growth. Shares edged up less than 1 % in extended trading on Wednesday.

The surge in demand for high‑bandwidth memory, a critical component for data‑center workloads, has been fueled by the generative AI boom. Micron, a major supplier to Nvidia, is positioned to benefit from this trend. In prepared remarks, CEO Sanjay Mehrotra noted that customers have significantly increased their financial commitments, raising the total from $22 billion reported in June to $32 billion, with most commitments made as cash deposits.

Micron President and Chief Operating Officer Manish Bhatia said memory has become the primary bottleneck in AI development, outpacing other areas such as logic chips and data‑center power consumption. He added that the data‑center market is now the largest consumer of memory and storage.

Orders have consistently outstripped capacity, prompting Micron to announce plans to increase U.S. investments to over $250 billion through 2035. Tech giants including Amazon and Alphabet are projected to spend more than $730 billion on AI infrastructure this year. Bhatia warned that new capacity can only be introduced at a limited pace, citing diminishing returns from future technology transitions. The company is expanding capacity at sites worldwide, including new facilities in Japan and the United States, with first silicon wafer output expected in mid‑2027. Ramp‑up will take several quarters before factories achieve meaningful market impact.

Finance chief Mark Murphy reported that remaining performance obligations under long‑term agreements have risen to about $150 billion, up from roughly $100 billion in the prior quarter. He projected that fiscal 2027 will be another record year, with sequential revenue growth expected each quarter. Micron forecasts first‑quarter revenue of $61.5 billion, plus or minus $1.5 billion, compared with the average analyst estimate of $57.02 billion. Adjusted earnings per share are expected to be $38.15, plus or minus $1, versus estimates of $35.40.

Mehrotra added that Micron has secured agreements for most of its 2027 high‑bandwidth memory output and will increase capital spending for fiscal 2027 beyond prior plans. The company competes with South Korean rivals Samsung Electronics and SK Hynix, which dominate the global high‑bandwidth memory market.

Analyst Bob O'Donnell of TECHnalysis Research said Micron’s strong earnings and forecast should quell doubts about the sustainability of the AI buildout.