Micron MU
This is a cyclical business at a record peak. The open question is how much of this year's pricing the share price treats as permanent. Seven questions that follow the money through the business, the price and the tape. Every number comes from SEC filings and market data, and every score from a rule printed next to it.
What this File stands on. Annual figures: FY2026 10-K (year to 2026-09-03, filed 2026-10-09). Prices to 2026-10-21. The numbers rebuild every Monday, so each new 10-Q or 10-K appears within a week of filing. The written parts (business, defences, risks, the read) are from the FY2026 10-K, and the terminal read is dated 2026-10-11.
32 cents of every revenue dollar come from Cloud Memory, up 219% on the year.
What it does
Designs and builds the memory and storage chips that every computer, phone, car and AI server needs to hold data while it works and after it is switched off.
How it charges
Sells DRAM, NAND and NOR chips, modules and SSDs to device makers and cloud companies. DRAM is about three quarters of revenue, led by the high-bandwidth memory that sits next to AI processors.
Who buys, and why
Cloud giants, server, phone, PC and car makers. Over half of revenue comes from the top ten customers, and about 60% from data centers. Many buy on multi-year contracts with price bands and cash deposits.
Of every $100 of sales, $43 is left for owners once staff stock pay is counted as a cost.
Owner earnings = operating cash flow minus capital spending minus stock-based pay. Stock pay is a real cost: it is paid in shares instead of cash.
What it is building Too cyclical to judge
It reinvests heavily, but profits swing with the cycle, so whether the investment pays off cannot be read from the numbers yet.
R&D is treated as an investment written off over 5 years. Capital spending up to depreciation keeps the business standing; anything above it is growth spending. A company that puts more than 10% of sales into R&D and growth capex is building; it is paying off when after-tax profit has grown by at least 12 cents for every extra dollar of capital it put in.
New shares add 1.5% a year, so each share captures less of the growth than the company does.
CEO Sanjay Mehrotra, in the seat since 2017.
The strongest defence is scale economies. Gross margin has been moving, within 90 points over 5 periods.
Most memory is interchangeable between suppliers, but HBM needs long qualification with each AI chip and multi-year contracts now lock in volumes.
A chip is no more useful because other customers buy the same one.
Only three companies make leading DRAM and a new fab costs tens of billions, but Samsung and SK hynix are as big or bigger.
Process know-how keeps it on the leading node, yet rivals reach each node within a year, and the Crucial consumer brand is being wound down.
Sources are rated from the annual report (notes file). The two evidence checks are computed: margins that hold and high returns on capital are what a real defence looks like in the numbers.
A reverse discounted cash flow: the growth today's price requires, set against what the business has actually delivered, and how that changes if you demand a different return.
The IVT terminal read on the weekly and daily charts: bias, money flow, strength, whether the entry window is open, and the sharp captures.
The worst fall of the last five years, the balance sheet, the pressure points and the specific conditions that would break the case.
Where the business sits on quality against price, the quality score line by line, and the conclusion.
The rest of the MU File
Chapters 5 to 8: the growth today\'s price assumes, the full IVT terminal read with sharp captures, what would break the case, and the final read.
Where every number comes from 15 figures, each linked to its SEC filing
| Figure | Value | Period | Filing |
|---|---|---|---|
| Revenue | $133.2B | FY26 | 10-K, filed 2026-10-09RevenueFromContractWithCustomerExcludingAssessedTax |
| Gross profit | $107.5B | FY26 | 10-K, filed 2026-10-09GrossProfit |
| Cost of sales | $25.7B | FY26 | 10-K, filed 2026-10-09CostOfGoodsAndServicesSold |
| Operating income | $99.3B | FY26 | 10-K, filed 2026-10-09OperatingIncomeLoss |
| Net income | $85.0B | FY26 | 10-K, filed 2026-10-09NetIncomeLoss |
| Operating cash flow | $89.7B | FY26 | 10-K, filed 2026-10-09NetCashProvidedByUsedInOperatingActivities |
| Capital spending | $30.7B | FY26 | 10-K, filed 2026-10-09PaymentsToAcquirePropertyPlantAndEquipment |
| Stock-based pay | $1.3B | FY26 | 10-K, filed 2026-10-09ShareBasedCompensation |
| Buybacks | $650M | FY26 | 10-K, filed 2026-10-09PaymentsForRepurchaseOfCommonStock |
| Dividends | $610M | FY26 | 10-K, filed 2026-10-09PaymentsOfDividendsCommonStock |
| Diluted shares | 1,143M | FY26 | 10-K, filed 2026-10-09WeightedAverageNumberOfDilutedSharesOutstanding |
| Cash and investments | $38.4B | 2026-09-03 | 10-K, filed 2026-10-09CashAndCashEquivalentsAtCarryingValue |
| Debt due within a year | $491M | 2026-09-03 | 10-K, filed 2026-10-09DebtCurrent |
| Long-term debt | $2.8B | 2026-09-03 | 10-K, filed 2026-10-09LongTermDebt |
| Shareholders' equity | $138.4B | 2026-09-03 | 10-K, filed 2026-10-09StockholdersEquity |
Revenue fell more than 10% in at least one of the last 5 years (FY23: -49%), so margins and returns are scored on their medians across those years, not on the latest year.
Educational research, not investment advice and not a recommendation to buy or sell any security. Scores are mechanical and reproducible from public filings; the notes are the author's judgment. Author position in MU: none. Sources: SEC EDGAR XBRL company facts (filings to 2026-09-03), daily prices to 2026-10-21. Past performance does not predict future returns.