Micron Technology shares declined 4% on Thursday as investors digested climbing US Treasury yields and firmer crude oil prices in the run-up to the memory chipmaker's fiscal fourth-quarter earnings release, scheduled for Sept. 30. The pullback came even as one Wall Street firm grew more constructive on the stock.
Baird raised its price target on Micron to $1,520 from $1,280 while maintaining an outperform rating. The revised target implies roughly 40% upside from Friday's closing price. Analyst Tristan Gerra said the firm had turned "incrementally positive" on Micron's near- and medium-term prospects, pointing to three drivers: accelerating demand tied to agentic artificial intelligence, an expectation that industry DRAM supply growth will slow in 2027, and a richer margin outlook for high-bandwidth memory next year.
The stock has been one of the year's standout performers. Micron shares have climbed 279% in 2026, supported in part by a shortage of memory chips, and touched an intraday record of $1,255 on June 25.
AI workloads underpin the DRAM outlook
Micron's core growth story rests on demand for high-performance memory as AI adoption spreads. AI systems process enormous volumes of data and require memory with greater capacity and bandwidth, which supports DRAM consumption in AI servers and other high-performance computing systems.
DRAM is expected to be Micron's largest growth engine in the fiscal fourth quarter. The Zacks Consensus Estimate projects DRAM revenue of $38.26 billion, a 325.8% increase from the same quarter a year earlier. That forecast arrives alongside improving conditions in the broader memory market, which had previously contended with excess supply, weak pricing, and bloated inventories. Those pressures have eased, producing a healthier balance between supply and demand that is expected to support both revenue and profitability in the quarter.
HBM gains importance in the AI supply chain
High-bandwidth memory has become a second pillar of Micron's AI thesis. AI accelerators rely on HBM to deliver the memory bandwidth needed for increasingly complex workloads. Micron is mass-producing HBM for NVIDIA's next-generation AI chips, giving it exposure to growing demand for AI infrastructure.
HBM supply remains relatively tight while demand from AI data centres continues to rise. Micron has also flagged strong interest in HBM4, and its HBM4 12-high ramp is progressing faster than the earlier HBM3E 12-high ramp, which could lift HBM's contribution to revenue and profitability over time. Baird's Gerra cited a higher margin profile for HBM next year as one factor behind the firm's positive stance.
Partnerships broaden AI exposure
Micron's relationships with major semiconductor companies give it a foothold across several AI platforms. NVIDIA has selected Micron as a major HBM supplier for its Blackwell GPUs and Vera Rubin AI platform. Micron also supplies HBM3E products for Advanced Micro Devices' Instinct MI350 AI accelerators, and it is working with Marvell Technology on advanced memory solutions for AI applications. Marvell's focus on custom AI silicon offers another route for Micron to participate in the buildout of AI infrastructure.
Micron's fiscal fourth-quarter results are due Wednesday. LSEG consensus expects earnings to rise 939% year over year. Analyst sentiment remains broadly positive, with 46 of 49 analysts tracked by LSEG rating the stock a buy or strong buy, and the average price target implying about 34% upside.
This article is for informational purposes only and does not constitute financial advice.
