Micron Technology Inc Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Timothy Arcuri - UBS Securities - Analyst : Thanks a lot, Sanjay. Sanjay, I wanted to ask how you see the HBM TAM scaling with the accelerator TAM. One thing that's been clear over the past three months or so is that the accelerated change is definitely upsiding and growing a lot. And it seems if I take their projections and I take your HBM projections, it seems like the HBM market is going to remain 15% to 20% of what the overall accelerator market is. I guess, how do you see the HBM TAM scaling with that market? And then is there some limit or like asymptote that we begin to reach in terms of HBM attached to these GPUs in these custom ASICs?

Question: Timothy Arcuri - UBS Securities - Analyst : Thanks a lot, Sanjay.

Question: Vivek Arya - BofA Global Research - Analyst : Thanks for taking my question. I wanted to talk about gross margins. So first, what is driving the upside sequentially? And then is this the new baseline for gross margins? And then what would be the puts and takes as we look at the next few quarters beyond Q4? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 8:30PM, MU.OQ - Q3 2025 Micron Technology Inc Earnings Call

Question: Vivek Arya - BofA Global Research - Analyst : And anything beyond this mark? Any puts and takes as we look at the next several quarters? Is this the new baseline? Or is it going to be entirely dependent on the direction of pricing?

Question: Vivek Arya - BofA Global Research - Analyst : Thank you.

Question: CJ Muse - Cantor Fitzgerald - Analyst : Yeah. Good afternoon. Thank you for taking the question.I was hoping to revisit your comments on HBM. So you're talking 23%, 24% market share. And it sounds like you're now calling not exiting the year but sometime in the second half. So that's coming in better. And so I guess first question is, should we be thinking that, that number is a 22%, 23% depending, I guess, on seasonality of the $35 billion number. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 8:30PM, MU.OQ - Q3 2025 Micron Technology Inc Earnings Call And then perhaps more importantly, as you think about HBM growth in calendar, how should we be thinking about the contributions to that growth, both from bits as well as higher ASPs as you go to next-generation products? Thanks so much.

Question: CJ Muse - Cantor Fitzgerald - Analyst : Just trying to understand how you talked about getting to your DRAM market share, which I think you said 23%, 24% for the HBM market, and your previous comments were exiting the year. Now you're saying sometime in the second half. So trying to get an idea of what that revenue number looks like.

Question: CJ Muse - Cantor Fitzgerald - Analyst : Thank you.

Question: Thomas O'Malley - Barclays Capital - Analyst : Hey, guys. Thanks for taking the questions. Two here. So my first on the HBM side, you're obviously reaching your share target a little bit earlier. Going into next year, are you guys ready to talk about what you think that your normalized share will be? Obviously, there's difficulties with some of your competitors getting qualified. If that continues into next year, do you guys have a view of if you're able to increase capacity? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 8:30PM, MU.OQ - Q3 2025 Micron Technology Inc Earnings Call And if you are, what that share may look like? And then two, on the NAND side, where does utilization stand today? And obviously, you're going through some of the transitions right now internally, which has allowed you to keep some things offline. But as you move into next year, what is your plan for utilization? Is that going to be market dependent? Or at some point, do you need to start bringing on utilization just from the fact that there's a gross margin headwind? Thank you.

Question: Thomas O'Malley - Barclays Capital - Analyst : Thank you, Sanjay.

Question: Harlan Sur - JPMorgan - Analyst : Hey, good afternoon. Thanks for taking my question. If I rewind back one year ago during your June earnings call, you guys did say back then that you were sold out on your HBM supply through calendar '25 and that majority of that committed supply was locked in from a pricing perspective. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 8:30PM, MU.OQ - Q3 2025 Micron Technology Inc Earnings Call One year later, where are you on your negotiations for your calendar '26 HBM supply and pricing discussions, the team's supply outlook for next year fully committed to? Or maybe a better way to frame it, right? Because I know that the HBM3E and HBM4 12-high qualification cycles might be taken a bit longer. But maybe the other way to frame it is, if you look at your customers' calendar '26 forecasted demand for HBM, is it exceeding your forecasted supply capability?

Question: Harlan Sur - JPMorgan - Analyst : Thanks, Sanjay.

Question: Joseph Moore - Morgan Stanley - Analyst : Okay. Thank you. I wonder if you could talk in terms of your long-term CapEx plans and the 35% of revenue levels? Is that a reasonable guideline to think about for fiscal '26? Or are you thinking because of the opportunity here you need to invest ahead of that? Thank you.

Question: Joseph Moore - Morgan Stanley - Analyst : Great. Thank you.

Question: Krish Sankar - TD Cowen - Analyst : Yeah. Hi. Thanks for taking my question. I had two questions for Sanjay or two-part question. One is, when you look into HBM4, given the double of I/O content through silicon via, what trade ratio should we expect for HBM4? And also, when you look at, broadly speaking, is there a difference in HBM bits and margin profile between selling to GPU versus ASIC customers? Thank you.

Question: Krish Sankar - TD Cowen - Analyst : Thanks, Sanjay. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 8:30PM, MU.OQ - Q3 2025 Micron Technology Inc Earnings Call

Question: Chris Caso - Wolfe Research - Analyst : Yes. Thank you. Just a clarification on one of the things you said in the prepared remarks, you talked about there may have been some tariff-related pull-ins by certain customers. I think overall, your comments suggest that you -- at least my interpretation is that you think that the customer inventory levels are getting a bit cleaned up here. Could you clarify the remarks a little bit, put it in context of what you expect that means for customer inventory levels and how that affects your view of bit demand in the second half?

Question: Chris Caso - Wolfe Research - Analyst : Got it. Thank you.

Question: Vijay Rakesh - Mizuho Securities - Analyst : Yeah. Hi, Sanjay and Mark. Just a quick question on the HBM4. Just wondering how the qualification is progressing? And if you continue to see that similar power performance leadership that you guys have had on HBM3E, do you see that continuing on the HBM4 side as well? Thanks.

Question: Vijay Rakesh - Mizuho Securities - Analyst : Got it. And on the SSD side, just quickly, with your focus on AI servers, are you seeing an actuated pull-through on the AI server side for SSDs as well? Thanks.

Question: Vijay Rakesh - Mizuho Securities - Analyst : Great. Thank you.