Micron projects fiscal Q4 revenue of $50B ± $1B as it outlines $100B in SCA RPO (NASDAQ:MU)

Micron reported a record fiscal third quarter on Wednesday. Revenue hit $41.6 billion, earnings per share also set an all-time high. The memory chip maker guided fiscal Q4 revenue to $50 billion, plus or minus $1 billion, a midpoint above the $49 billion consensus that had crept higher in recent weeks. The implied sequential growth of roughly 20% reflects sustained demand for high-margin HBM3E and data center SSDs. Gross margin guidance landed at 58%, plus or minus one percentage point.

The headline number is the supply chain agreement backlog. Micron disclosed $100 billion in remaining performance obligations and $22 billion in customer deposits, which the company called non-refundable. RPO represents committed future revenue under long-term contracts, mostly with hyperscale cloud operators and enterprise AI buyers. A $100 billion line covers roughly two years of current production rates – visibility no other memory maker has disclosed at this scale, the company's earnings materials show. The $22 billion in deposits, cash received or receivable but not yet recognized, de-risks the build-out cycle.

Those deposits fund part of a $25 billion capital spending plan for fiscal 2026, up from $18 billion in fiscal 2025. Micron said most of the increase goes to HBM4E packaging capacity and 1-gamma node conversion in Idaho and Hiroshima. The balance sheet ended Q3 with $14.3 billion in cash and marketable securities against $8.5 billion in long-term debt.

Demand remains concentrated in data center AI. Compute Express Link memory, HBM stacks, and high-capacity DDR5 DIMMs accounted for more than half of Q3 revenue, Micron said. PC and smartphone segments grew only mid-single digits sequentially, a reminder that the broad cyclical recovery is uneven. The data center segment alone now contributes over 60% of total revenue, a mix shift that has lifted blended gross margins by nearly 1,000 basis points year over year.

Where margins peak is the open question. Q4 guidance of 58% gross margin is already above the long-term target of 55%. Some sell-side analysts have questioned whether HBM pricing can hold its current premiums once Samsung and SK Hynix bring more capacity online. Management pushed back on that concern in prepared remarks, pointing to the two-year SCA agreements that lock in pricing for HBM deliveries through calendar 2027.

The stock rose 3.7% in after-hours trading following the release. Micron reports Q4 results in late September.