Memory manufacturer Micron warned that RAM shortages will persist into 2028 and perhaps beyond. Speaking on the company financial year 2026 earnings call, CEO and board chair Sanjay Mehrotra told investors that Micron has already sold most of the memory it will make next year. Customers will pay much higher prices than they paid this year.
Mehrotra stated that demand will exceed supply in both calendar 2027 and 2028. He added that the industry will see greater tightness in 2027 and 2028 compared to 2026, noting that the supply and demand environment is only getting tighter. He confirmed that the company does not have line of sight to when supply and demand will return to balance.
Micron plans to bring new factories online in 2028 with help from planned capital expenditures of $25 billion in the first half of its new financial year. Executives warned those facilities will not immediately help improve availability or ease prices. Demand for the high bandwidth memory needed in artificial intelligence hardware is growing faster than demand for the DRAM used in servers.
The company reported massive financial gains
The company reported massive financial gains during the earnings announcement. Q4 revenue reached $54.25 billion, up from $11.3 billion last year. Annual revenue landed at $133.2 billion, which is vastly higher than last year's $37.4 billion. Net income rose 895 percent to $85 billion.
Cloud memory business unit gross margin reached 83 percent in Q4, up from 59 percent in the previous year. The core datacenter business unit recorded a Q4 gross margin of 90 percent, up from 41 percent. Sales of solid state disks for datacenters reached almost $10 billion for the quarter, marking a year over year increase of more than 1,000 percent.
Micron collaborates with Nvidia on custom memory
Mehrotra highlighted a strong roadmap for future high bandwidth memory products and collaboration with Nvidia on the industry's first custom high bandwidth memory four epsilon implementation called NV-HBM. Micron forecast first quarter fiscal 2027 revenue of $61.5 billion, plus or minus $1.5 billion, with a gross margin of 86.25 percent. The company's share price spiked before returning to its close of day price in after hours trading.
