Micron stock (NASDAQ:MU) has captured investors’ attention after climbing roughly 24% in just one month, outperforming the S&P 500 Index’s modest 1% gain. The jump reflects strong demand for DRAM and NAND chips, fueled by the explosive growth of AI data centers and a rebound in consumer devices such as PCs and smartphones.
Supply constraints in the memory market have also played a critical role, pushing up chip prices. These pricing tailwinds are expected to last well into 2026, giving Micron stock a robust runway for revenue and margin expansion despite its already strong performance in fiscal 2025.
Strong Revenue and Margins Driving Growth
In fiscal 2025, Micron stock’s underlying business fundamentals impressed investors. Revenue increased 50% to a record $37.4 billion, while gross margins expanded 17 percentage points to 41%. A significant portion of this growth came from high-value data-center products and the rising strength of DRAM pricing across multiple end markets.
Global memory supply is tightening further. Samsung Electronics has raised prices on certain memory chips by up to 60% since September, according to Reuters. This environment benefits Micron stock, as strong demand and limited supply can help maintain high pricing and profitability, potentially driving the share price higher.
AI and Data Centers Fuel Micron Stock
The AI-driven infrastructure boom is a major catalyst for Micron stock. As data centers expand to support AI agents, heavier enterprise computing workloads, and traditional server deployments, demand for high-performance memory grows. In fiscal 2025, Micron’s data center segment accounted for more than half of total revenue, lifting overall gross margins.
Micron’s High Bandwidth Memory (HBM) segment is also seeing rapid growth. In Q4 of fiscal 2025, HBM revenue nearly hit $2 billion, putting the business on track for an $8 billion annual run rate. Products like HBM3E are widely adopted in AI platforms, while upcoming HBM4E technology will offer customizable configurations that could generate higher margins.
Negotiations for HBM4 supply indicate that Micron could sell out its entire 2026 capacity early, further reinforcing the bullish case for Micron stock.
PCs and Mobile Boost Opportunities
Beyond AI infrastructure, PC shipments are improving, creating additional demand for Micron stock. In mobile, AI-capable smartphones are driving higher DRAM content per device, increasing Micron’s market opportunities in the handset segment.
With memory supply tightening and AI infrastructure expanding, Micron stock appears well-positioned for sustained earnings growth in the coming years.
Should You Buy, Sell, or Hold Micron Stock?
Micron stock’s performance in 2025 has been impressive, but many analysts believe there’s still upside potential. The company benefits from strong AI demand and pricing power across memory products. Its earnings outlook has improved meaningfully.
Trading at roughly 15.3 times forward earnings, Micron stock remains relatively inexpensive given its growth trajectory. Wall Street forecasts a 101.6% surge in EPS in fiscal 2026, suggesting further upside. Analysts maintain a “Strong Buy” consensus rating, reflecting optimism about continued growth.
Investors seeking exposure to AI-driven memory demand and tight supply markets may find Micron stock an attractive option to buy or hold in 2025 and beyond.
Potential Risks to Consider
While Micron stock has strong momentum, investors should remain aware of potential risks. Memory markets are notoriously cyclical, and any slowdown in PC or smartphone demand could pressure revenue. Competition from companies like Samsung Electronics (KRX:005930) and SK Hynix (KRX:000660) may also impact pricing power. Additionally, AI adoption, while growing, depends on corporate and government investment cycles, which can fluctuate. Supply chain disruptions, geopolitical tensions, or rapid technological shifts could affect Micron’s production and margins. As with any growth stock, balancing potential rewards with these risks is crucial before deciding to buy, sell, or hold MU stock.
Featured Image: Megapixl
Author Stephanie Bédard-Châteauneuf 
