Micron guides $50B Q4 revenue, 86% margins; signs 16 strategic customer agreements worth ~$100B

Micron delivered record fiscal Q3 revenue of $41.46 billion and guided fiscal Q4 2026 to $50 billion ±$1 billion, far exceeding Wall Street's $43.24 billion estimate. Gross margin guidance of approximately 86% reflects sustained pricing power and node cost reductions. The company reported net income of $28.24 billion and signed 16 strategic customer agreements (SCAs) with major AI and data center companies, totaling approximately $100 billion in remaining performance obligations (RPO).

Data center revenue exceeded $25 billion in Q3 alone, on a run-rate annualized pace exceeding $100 billion. Micron disclosed $22 billion in cash deposits and related financial commitments from the SCAs, which are take-or-pay agreements locking in minimum volumes and pricing through multi-year periods. HBM4 volume shipments ramped ahead of schedule—yield doubling that of HBM3E 12-high—with over $1 billion in HBM4 revenue already shipped. The company projects continued tight market conditions beyond calendar 2027 driven by AI-infrastructure demand and structural supply constraints.

Micron's fiscal Q4 capex guidance of $10 billion brings full-year fiscal 2026 capital spending to approximately $27 billion, with quarterly capex in fiscal 2027 expected above Q4 levels—more than half from construction capex for cleanroom capacity. The company projects free cash flow to increase substantially in Q4 and intends to increase capital returns beginning December 9, 2026 (the second anniversary of its CHIPS Act agreement signature), with plans to return 100% of excess cash to shareholders over time.

For AI architects evaluating memory supply, the strategic customer agreements signal multi-year price and volume certainty at a scale that dwarfs spot market dynamics. Micron's data center revenue run-rate now exceeds $100B annually; HBM4 ramp trajectory and next-gen roadmap visibility into 2027 are actionable for systems planning. The structural supply/demand imbalance supports capex discipline for memory-intensive workloads.