MICRON TECHNOLOGY INC annual report, FY2026

Micron Technology, Inc. — FY2026 Form 10-K

Business context and reporting period. Micron designs and manufactures DRAM, NAND and NOR memory and storage products for data-center, mobile, client, automotive and embedded markets. This is the annual report for the 53-week fiscal year ended September 3, 2026; the prior fiscal years each had 52 weeks. The filing provides annual results, not a clear standalone fourth-quarter income statement.

Financial performance

Amounts are U.S. dollars; financial statement amounts below are in billions except per-share data.

Metric	FY2026	FY2025
Revenue	$133.19	$37.38
Gross profit / margin	$107.50 / 81%	$14.87 / 40%
Operating income	$99.34	$9.77
Net income	$84.97	$8.54
Diluted EPS	$74.33	$7.59
Operating cash flow	$89.68	$17.53
Capital expenditures	$30.71	$15.86

• Revenue rose 256%. DRAM revenue was $100.68 billion, up 252%, and NAND revenue was $31.79 billion, up 274%. Management attributed growth to higher selling prices—approximately 180% for DRAM and 200% for NAND—and mid-20% range increases in bit shipments for both.
• Management attributed the gross-margin expansion to stronger pricing, favorable product mix and manufacturing cost reductions. AI-related demand and constrained industry supply were key drivers.
• By business unit, revenue was CMBU $43.09 billion, CDBU $37.59 billion, MCBU $36.60 billion and AEBU $15.89 billion. Data-center-related CMBU and CDBU together generated $80.68 billion.
• Net cash used in investing activities was $61.64 billion, including $30.71 billion of capital expenditures and $32.88 billion of net outflows from purchases, maturities and sales of available-for-sale securities. Government incentives provided $3.32 billion toward capital expenditures.
• Cash and marketable investments totaled $73.45 billion at year-end, versus $11.94 billion a year earlier. Total debt carrying value was $5.18 billion, down from $14.58 billion. Micron repaid $10.04 billion of debt and recorded a $510 million loss on debt prepayments.
• Current assets were $91.07 billion and current liabilities $27.48 billion. Receivables were $36.20 billion and inventories $10.37 billion.

Material changes, outlook and notable items

• FY2026 results mark a sharp recovery from FY2025, with substantially higher prices and shipments across DRAM and NAND. MCBU revenue increased despite lower bit shipments as supply was redirected to other business units.
• Management said AI-driven demand is outpacing industry supply. It expects strategic customer agreements to improve demand visibility and business stability. These multi-year take-or-pay contracts have binding volume commitments and generally use fixed or periodically negotiated pricing, often within price bands. Management says margins under agreements with price bands are expected to exceed the company’s peak quarterly margins in prior cycles.
• FY2026 included $500 million of patent-license charges in operating expenses and $510 million of debt-prepayment losses in non-operating expense. The effective tax rate was 14.8%, compared with 11.6%; Singapore Pillar Two minimum taxes largely offset tax-incentive benefits.
• Customer deposits under strategic agreements totaled $12.75 billion received in FY2026; nearly all are scheduled to be repaid in 2029–2031 if customers meet minimum purchase commitments. Year-end remaining performance obligations were approximately $134 billion, including $13 billion recognized as contract liabilities; about one-fourth is expected to be recognized over the next 12 months. The filing cautions these obligations are not necessarily indicative of future revenue.
• Management expects net capital expenditures of approximately $11.5 billion in Q1 FY2027 and approximately $25 billion in the first half, with higher spending in the second half. No specific full-year FY2027 revenue or earnings guidance is provided. Management expects liquidity sources to cover requirements for at least 12 months and thereafter for the foreseeable future.
• Capacity plans include U.S. fabs in Idaho and New York, with initial wafer output projected for mid-2027, late-2028 and 2030 for the respective projects; Singapore HBM packaging capacity is expected to expand beginning in early 2027. Micron also announced a planned $10 billion investment over a decade in Micron Research Labs. Construction timing, costs, demand and government incentives remain execution risks.
• After year-end, the board increased the discretionary repurchase authorization to $35.16 billion, subject to CHIPS Act restrictions and available cash; it does not require repurchases. A $0.15-per-share quarterly dividend was declared for payment in October 2026.
• Legal developments disclosed after year-end include an October 5, 2026 settlement and license agreement resolving all Netlist litigation claims, and an October 6 German court ruling against certain 3D NAND products in YMTC litigation; Micron appealed. The filing also describes pending YMTC, other patent, antitrust and New York construction-permit matters. Potential losses for the listed matters generally could not be reasonably estimated.

Key risks

• Memory prices and margins are cyclical; additional industry capacity or weaker-than-expected AI demand could pressure selling prices and utilization.
• Approximately 60% of FY2026 revenue came from the data-center end market and more than half from the top ten customers. A majority of DRAM production was in Taiwan, creating geographic concentration exposure.
• Supply-chain constraints, advanced packaging and equipment availability, power and water needs, and fab construction delays or cost overruns could limit output or returns on investment.
• Trade restrictions, tariffs, geopolitical tensions and China’s restriction on sales to certain critical information infrastructure operators may affect sales, sourcing or operations.
• Government funding and tax incentives are conditional and may be reduced, terminated or subject to clawback. Labor actions, cyber incidents, product-quality issues and litigation are also identified risks.

Investor verification checklist

• Verify that pricing, bit shipment growth and the unusually high 81% gross margin are sustainable, and assess sensitivity to a memory supply-demand reversal.
• Review strategic customer contract terms, minimum purchase commitments, pricing bands, deposit repayment conditions and the distinction between remaining obligations and forecast revenue.
• Track FY2027 capital spending, fab schedules, funding milestones and incentives, and compare investment needs with operating cash generation.
• Assess customer and data-center concentration, Taiwan production exposure, and potential effects of trade restrictions and supply-chain interruptions.
• Monitor the YMTC appeal and other patent, antitrust and New York project proceedings, along with associated costs or operating restrictions.
• Confirm the timing and permitted scale of repurchases under CHIPS Act conditions, and evaluate tax, cash-flow and share-compensation effects.