Micron Technology, Inc.

Q2 2026 Earnings Call — March 18, 2026

Analyst Robbie Marcus (JPM): Thanks for taking the questions. Congrats on a good closing quarter. Two questions from me. I wanted to start first with 2026 guidance came in above the street, and I believe that plaque number is also above where consensus sits. Love to just hear the confidence in the building blocks, particularly any extra commentary you have on PLAC so far in first quarter and feedback on the launch and the assumptions underpinning FFRCT, and then I have a follow-up.

Executive: Yeah, sure. Thanks, Robbie. Great to hear your voice. So, yeah, so thinking about 26, I mean, I'll start by saying I've never been more confident in this business and what we're setting up to deliver here. I think there is fundamental demand out there, and I could not be happier with our team's track record of execution. The way I would kind of categorize this guide is I'd put it as a healthy starting point, and we've talked about our guidance philosophy previously, uh, we want to provide very high conviction guides, uh, that set us up well, uh, you know, for quarters down the road.

Okay. So that's a high level. Um, you know, first, uh, around FFRCT, uh, and the base business, uh, I've got, uh, great confidence here. Okay. Um, and there's really kind of three drivers, uh, underwriting it. You know, we have, um, We have proven our ability to go out into the market and sign up new accounts. We just did the biggest year ever. We did 340 last year, as you're aware of. And I think our go-to-market model has proven our ability to go get it. And that number, incidentally, grows. The number of accounts we can go get grows by about 300 every year.

So, one, we can go get the account. Two, once they're in, we've got very predictable performance relative to utilization. We see physicians ramping and using our FFRCT technology very predictably. So they become healthy in that regard. And then lastly, there's this kind of underlying factor out there relative to CCTA in and of itself. And that, I like to think of that, that genie is not going to get put back in the bottle. CCTA as a frontline test for diagnosing coronary artery disease is in the guidelines, not just in the U.S., but around the world. And I think we're on the right side of history here, and that's going to continue to sort of fuel growth moving forward.

So that's the core business. And then what makes 26 really exciting is plaque. And I think we did a great job last year. We signed up close to 500 accounts by the end of 25. We're well into Q1 here right now, and we've had some strong activations that have continued. I have visibility, obviously, into the funnel. So I've got high confidence that by the end of this year, we'll be in 1,000 accounts. And again, just as frame of reference, it took us eight years to get into 1,000 accounts with our FFRCT business. We'll do it in less than two with FLAC. And then the accounts that are live now, the early trends are very positive relative to volume. So I'm very happy about that.

Now, I will say I don't think this is going to be a light switch moment. I still think, as Vikram mentioned, the material volume is going to come in the back half. We've got some catalysts out there. We've got the one-year decide data reading out in the second half of this year. Physicians really need to experience it. experience outcomes with their individual patients to get into a more kind of higher utilization rate. But all that being said, very confident. And again, I'd say this is a high conviction forecast that we're giving you.

Yeah, I'll probably add some commentary to that. Again, this is a high confidence baseline that really sets a solid foundation to allow for quarterly progression. Additionally, there's, you know, pockets of, you know, incremental pockets of potential upside. I'll start with FFRCT. Again, a high-conviction guide, but not factored in. Any utilization tailwinds from the navigator launch, so that will be upside. The feedback from the physician community has been incredibly positive.

Now, focusing on FLAC, and, you know, you had a very specific question there, Robbie. We'll point out that, again, this is highly de-risked given the early volume data that we're seeing in Q1. If the adoption curve were to steepen more quickly, it provides an additional catalyst for growth. Second, we referenced 1,000 accounts by the end of the year. We've got strong funnel with good visibility, so any outperformance there would also be beyond the range we provided for guidance. Stepping back, the framework here is straightforward. We've been conservative around optionality and realistic around execution assumptions. So the overall skew in our view is to the upside.

Analyst Robbie Marcus (JPM): Then just as a follow-up, you know, a lot of software companies have come under pressure from fears around AI that they could, you know, do it better and faster. And obviously there's a lot of moats you have with your data and tech and med tech are very different sectors for a reason. I'd love to get just on record your view of your moat around the business versus some of the AI companies that are hitting software and how you've feel your defenses and things you're doing to, you know, stay ahead of all the competition. Appreciate it.

Executive: Yeah, sure, Robbie. And I think that question makes a lot of sense given some of the recent, you know, headlines. You know, I'll say, I mean, I would characterize our moat as highly defensible, okay? And I think there's a couple of components that sort of, you know, to make it up here. The first is, I think as everybody's aware, an AI model is only as good as the training set and the data that that model is trained on. And we have, and we're very proud of it, what we believe to be the world's largest proprietary CT database of annotated CT images. We've got over 160 million images. This data is effectively ground truth data and it does not exist in the public domain. So there's no large data set out there that somebody very quickly could go acquire and start training a model on.

We've been training this model and we've been building this data set for over 10 years. So not only is it very large at 160 million annotated CT images, it's also super diverse because it's got all sorts of different types of anatomy and types of CT capital feeding into it. The last thing I'll say on it is right now, we're already connected, and this is sort of at the end or the start of this year, we're connected to 60% of the market's CCTAs. So every day as the category grows, we're growing disproportionately with it. So this would be a very difficult catch-up game if somebody were to try to start a race here.

So that's the data that the algorithms are trained on, but that works hand-in-hand with clinical evidence. And we like to say you can't code your way into clinical trust. Clinical trust with a physician comes by delivering high-quality clinical data. And HeartGlo as a company has been investing in this regard for over 10 years. We have over 600 peer-reviewed publications. We've got a couple randomized controlled trials. This is high-quality clinical data, and you can't fast-forward that. There's no way to rush that. And so this is an incredible lead that we have, and we'll continue to invest and build on that.

Now, that clinical data works hand-in-hand with the fact that we're MedTech, and in MedTech, you can't have an AI hallucination the way you can in consumer technology. We are a regulated medical device. You need clinical data first to get FDA clearance, but then you need to operate within a regulated quality system. And we have just that, and of course we have our human in the loop that ensures our accuracy remains incredibly high. And then the last thing I'll say is, you know, we are software. And, you know, software is useless if it's not integrated into a doctor's everyday practice. And we are effectively the proven operating system, if you will, in over 15 hospitals and clinics right now.

Okay. So we work really hard to integrate in and meet our physicians where they are so we help them do their job easier. We don't ask them to adapt and do it with us. That can be a tough road to sort of hoe. Initially, it takes over a year to get into some of these hospitals. But once you're in, we're pretty sticky. And being the kind of operating system of choice, we think is a great advantage for us. And then lastly, underscoring all this, we've got a great, strong global patent portfolio that we think is very defensible as well. Appreciate it. Thanks a lot.

Analyst William Plovnik (Canaccord Genuity): Hey, great, thanks for taking my questions, and good evening. I'd like to ask just on the product itself. I mean, you guys are innovating rather quickly, and so you've had significant changes to both FFRCT and PLEC, I think, over the last three to six months. I was wondering if you could just kind of maybe highlight some of those changes and how they've impacted the workflow to help us understand. And then my follow-up is on the PCI Navigator. Just initial feedback, future data, product innovations. You know, we saw the first patient go into the registry. Just love to hear more on that. It sounds like, you know, you're using that as one of your competitive modes as well. Thanks.

Executive: Yeah, sure. So good to hear your voice, Bill. So on kind of the product innovation piece, you know, last year we introduced our next generation plaque algorithm, okay? And that was, again, we're going into this proprietary database that we have. We're training the algorithms to get smarter and we took what was already a really good plaque algorithm and we enhanced it. From a customer standpoint, there's no changes to the workflow per se. We're always doing behind the scenes work that I don't think is really, it's not material enough for a call such as this to take out steps and improve functionality of our product.

Two years ago, a little over two years ago, we launched our new, another example is we launched our new user interface, which incorporated both plaque and FFRCT co-registered with our risk profile, our nomogram information into a singular user interface. And now physicians can use that to interrogate the entire coronary tree. This year, and we're really excited. We're launching it actually next month. The team did a good job pulling it forward. We're launching our PCI Navigator, and we're really excited about that. And we've talked about the strength of the platform matters, and PCI Navigator expands our platform. And we really think for interventional cardiologists, this can be a pretty attractive tool for their toolkit.

And what allows them to do is really plan ahead before a PCI procedure so they can walk into that procedure knowing the right devices to select, the complexity of the anatomy, et cetera. That's very analogous to what they're already doing with TAVR and Mitral, et cetera. So we're excited to that. We haven't, and Vikram can speak to this if there's interest, we haven't necessarily baked in FFRCT upside as a result of this, but we do think it's possible. We think having an interventional cardiologist, who's an important part of the CV ecosystem, if you will, really advocate strongly for CT and heart flow pathway, that helps us. And certainly using heart flow on every case that comes in helps us as well. We're super excited about that.

Executive Vikram: Yeah, I'll quickly underscore, you know, our current forecast really does not assume any incremental upside from PCI Navigator. To the extent Navigator drives incremental activity, it'll really flow through FFRCT volumes as each case is anchored to an FFRCT order. And then, you know, we're highly encouraged by the early feedback we've received on the product and the early potential we see. But we would frame PCI Navigator as a longer duration growth vector for us than a real near-term driver of financial performance.

Analyst William Plovnik (Canaccord Genuity): And I just wanted to circle up with, you know, just on the consensus on Robbie's question, Q1 consensus, I think it's 46.9 million. That's up 26% year-over-year. You're guiding 24 to 26. How do we think about that first quarter? I mean, you're two weeks away from closing it. Are you extremely comfortable with that current number? Do you think it'll be higher, or how should we think of Q1? Thanks.

Executive: Yeah, in terms of phasing, generally, Bill, what I would say is, you know, our full year guide reflects, you know, a midpoint of 25% year-over-year for the first quarter, and this is specific to your comment there. We expect growth in excess of 30% year-over-year, and that bakes in about a sequential improvement of 1% to 2% full cognizance of where we are, you know, relative to the end of the quarter. Moving into Q2, for what it's worth, we typically benefit from a little bit of seasonality, and we expect that pattern to hold true in 2026 as well. And then as plaque starts to really materialize in 2026 towards the back half of the year, you'll see more sequential growth relative to where consensus is at. And again, plaque, you know, should plaque outperform, that's, you know, the principal upside to the back half phasing assumptions.

Thank you. Bill, just to round out your question on innovation a little bit, obviously Navigator is what we're discussing today. I would describe our pipeline of new products as really strong, and we'll have more news in future quarters of other innovations that are coming.

Analyst Matthew O'Brien (Piper Sandler): All right. Thanks for taking the questions. Just for starters, on the plaque side, should we continue to assume $350 per case for plaque here in 26? And is there any, you know, upward mobility to that revenue per case going forward?

Executive: Yeah, maybe I'll... I'll say a couple comments on plaque, and then Vikram, you can speak to the specificness of the model. I mean, first thing, Matt, I'll say, I mean, I've said this before, but it's worth saying again. I could not be more excited about what plaque is going to mean full stop. I think it's going to mean a lot for patients, most importantly. But I also think it's going to transform this business. Now, over time, we've got to be a little judicious in how we call it, given we're still in the early innings. And as we monitor patients, uptake every quarter we'll be able to adjust going forward. Part of that uptake, to your question, is pricing, and I'll let Vikram speak to that.

Executive Vikram: Yeah, happy to, John. So, Matt, relative to your question, given that we have now commercial pairs coming online, Aetna being the latest one that gets us to about 75% covered lives in the U.S., we now have clearer line of sight to pricing improvements over time. Our contracts with our customers have built-in mechanisms that enable better pricing with broader coverage. And so consequently, in our 2026 base plan, we have underwritten modest ASP upside in the 2026 plan and then more meaningful step-ups in future years.

Analyst Matthew O'Brien (Piper Sandler): Okay. So a little above 350 to start and then maybe going up more in 2027, 2028. Is that fair?

Executive Vikram: Okay. That's right.

Analyst Matthew O'Brien (Piper Sandler): Got it. And then, Vikram, just sticking with the numbers here a little bit, I wanted to get into gross margin because that was so good, but I'm trying to keep it to two here. Was the FFRCT case number per site similar to what you saw in Q3? Because, you know, given the number of hospitals you added, that's really good. And then, you know, I think it's kind of, you know, to the guidance question, if you assume, well, when I'm looking at the FFRCT revenue that's factored in when you think about the plaque growth plus OUS, it's the lowest level that we've seen from you guys or would see from you guys over the last three years. Is there something in there that we should be aware of, again, given all the momentum that we're seeing in the core FFRCT business, or is it just back to kind of what John was saying to start with, like, look, we're trying to be very conditions with how we're guiding early in the year, and then we'll kind of reflect back as things progress. Thanks.

Executive Vikram: Yeah, thanks for the question, Matt, again. You know, relative to cases per site, we did outperform despite the heavy onboard number. We were about 15% higher on a cases per site basis in 4Q25 relative to where consensus came at. And that's really, you know, driven by the strength of that market shift that's happening here with CCTA ultimately on its way to becoming standard of care.

With respect to guidance, you know, I'd say we've, you know, it's part, you know, part law of large numbers as well as a part guidance philosophy. You know, we're lapping an exceptionally strong year in 2025, and when you start with that kind of elevated base the growth rates really start to normalize. And then the second piece, to underscore what John said, this is core to our guidance philosophy. The framework we've put forward for 2026 still assumes very strong underlying demand from a nominal volume perspective with a fair amount of conservatism. So I would really view this guide as an earlier framework that intentionally leads sufficient room for quarterly progression.

Analyst Nathan Trebek (Wells Fargo): Hi, this is Nathan Trebek on for Larry. Thanks for taking the question. Can you talk about the utilization that you're seeing for plaque analysis in your FFRCT accounts? How does the utilization compare to FFRCT, and how do you envision utilization trending throughout 26? Thanks.

Executive: Yeah, thanks, Nathan. So, again, we're at the early innings, but I think what we're seeing so far is positive, okay? Now, you need to remember the total applicability for plaque is 60% of all patients. We're nowhere near 60% right now because we've just kind of got out the gates here. So over time, there's plenty of upside to ramp, but what we've seen is very positive and I think leads to sort of the bullishness that you're hearing from me today.

Relative to FFRCT, FFRCT obviously is a more mature diagnostic. Once an account is up and running, we see FFRCT being utilized pretty close to the full range. So that's the good news, but the full range is about half of what it is on plaque. So FFRCT is about 30% or 33% full utilization, and we get pretty close to that with most of our accounts. So I think over time, there's certainly an opportunity to see plaque really in a material way take off here. I think long-term, I've got really high confidence PLAC is going to be a bigger business than FFRCT. I think where we have to sort of wait and see and kind of measure it every week, every month, is what does that ramp look like? And we're in the early innings there, but again, so far, pretty positive.

Analyst Nathan Trebek (Wells Fargo): Okay, thanks for that. Can you talk about how you're helping your accounts to better understand how to utilize plaque analysis? And I guess what's next for plaque from a clinical data standpoint?

Executive: Yeah, well, we lean very heavily into education. And I think as we talked about before, you know, one important unlock is coverage. And, you know, we're making great progress there. That's super easy to measure, so to speak. Medical education is a little more nuanced. In the FFRCT journey, it was a much simpler story. You just needed to prove accuracy versus invasive FFR, and then everybody knew what to do with whatever .7 FFR value. PLAC is much more nuanced, and we are leaning in very heavily to help physicians understand how to use PLAC with their specific patients.

And we do a lot of medical education. I would say moving forward, and we're at AHA just this next week in New Orleans, and far and away, you know, the lion's share of everything we're talking about there will be plaque. In the second half of this year, the big data that we'll share is the one-year data on DECIDE, where we'll have one-year outcomes there, and that'll be another piece that's really important to bring to our physicians. Ultimately, what we're trying to do is shift it from clinical utility. Question number one is first, how do you use it to actual clinical management? And that's the journey that we're on with our physicians right now.

Analyst John (Stifel): Hi, John and team. This is John on for Rick today. A couple quick questions for me. First, I just wanted to ask about the broader role of CCTA for heart flow and how that's impacted growth today. I remember back in the IPO, you gave a couple metrics about how penetrated and utilized CCTA is for non-invasive coronary tests. I was just hoping for a general update on where CCTA adoption stands, how much are you benefiting from it, and how much more do we have to go in terms of uptake there in your view?

Executive: Yeah, sure. Thanks, John. Appreciate the question. So, again, we're trying to create a new standard of care here, and it's well documented that the existing standard of care is suboptimal. Patients are being misdiagnosed, way too many false positives, way too many false negatives. CT plus heart flow addresses that issue, and we're trying to create a new one. The first piece of that is CCTA being adopted. At the end of 2021, CCTA in the US came in as a level 1A test ahead of all other alternatives.

We like to say we're on the right side of history here, but we have a lot of upside. It's around 10 to 12%, I think, penetrated relative to the whole standard of care. So there's lots of ways to go before we get there. But as I said earlier, I don't think the genie is gonna get put back in the bottle there. I think it's just a matter of time between the guidelines, the stronger reimbursement, more and more readers are raising their hand, becoming CTA readers, plaque is coming on board, so that makes utility even that much greater.

All of those trends in my mind are durable, and there's a high ceiling for us to aspire to go hit. Now, from what I'm seeing in the data, I'm not seeing anything slowing us down. We're seeing more and more accounts join the category, so to speak. At the start of this year, there's 3,200 accounts with active CTA programs. We expect that number will be 3,500 before the year's out. Right now, the majority of volume coming off a CT scanner is not CCTA. It's for another modality. So more and more accounts can start adding slots to it before they even have to tap into kind of a longer uptick of a capital cycle. So there's lots of tailwinds into this story, and we continue to lean into them.

Analyst John (Stifel): That's helpful. And I just wanted to also ask about competition quickly here. I'm just curious what you're seeing in terms of win rates or when you're going up head-to-head against peers. Are you getting any pushback on price if they come below you? And just curious about how the broader HeartFlow ecosystem factors into the competitive positioning when you go up against others. Thanks.

Executive: Yeah, sure. So first thing I'll say, and I remind the team of this often, our competition is the standard of care, okay? When we wake up every morning, we are trying to convert volume from the existing standard of care into CT plus heart flow. And when we do that, we will be successful and patients will be better off. And we're continuing to focus on changing those practice patterns and bringing physicians into kind of a CT plus heart flow pathway.

Now, your question, I think, is more specifically around other AI vendors. This is not a new dynamic. Some of these vendors have been around since 2018, 2017. None of that is slowing us down. I think, if anything, having more competitors or players in the category is actually good for the category. We don't compete on price. We compete on the quality of our data, which we're extremely proud of. We're prospective. We're published. We lean into that. We prove our accuracy. And we compete on the quality of our products, and we continue to improve our product just like we're doing this year and expanding our platform with PCI Navigator.

We don't publish win rates and things like that, but I think our results are very positive, and I feel good about the way the team is competing and how we're winning in the market.

Executive: That's helpful. Thanks for taking my questions.

Executive: And with that, we conclude our Q&A session and conference for today. We want to thank everyone for participating. You may now disconnect.

Q1 2026 Earnings Call — December 17, 2025

Analyst Timothy Akiri (UBS): Thanks a lot. Sanjay, I wanted to ask you about customer LTAs. I know we're hearing about B5 that's being bundled with HBM and, in some cases, even NAND. Can you just talk about these LTAs? I know it sounds like these are, you know, stretching out through 26 and in some cases even into 27. I've even heard of some stuff into, you know, 28. So can you talk about the nature of these LTAs? And then I had a follow-up as well. Thanks.

Executive Sanjay (Title): These are multi-year contracts that we are in discussions with several of our key customers. And these contracts, of course, involve DLAM as well as NANDs. And, you know, with respect to terms, of course, these contracts that we are under discussion for are very different from private LTAs. They have specific commitments in them and much stronger contract structure. And beyond that, I can't be giving you specifics at this point. Of course, in the future, if and when appropriate, we'll be sharing further details. Thanks.

Analyst Timothy Akiri (UBS): And then Mark, I want to ask you about CapEx. So you took it up to 20 billion net, but it still seems, I mean, you're not guiding all fiscal 26 revenue. So we don't really know what the capital intensity number is, but it seems like it's like 25 to 30%, which is a little below your 35%, you know, metric that you usually think of. So is that because you're constrained because of fab space? And can you just talk about, does that sort of like roll into fiscal 27, where we would see, you know, CapEx up more near that 35% range? Thanks.

Management Mark (Title): You're right, Tim. We're not providing a full-year revenue guide. We did indicate that our CapEx was going up in fiscal 26. And, you know, a substantial part of that CapEx is support DRAM and specifically HBM and the 1 Gamma and 1 Gamma RAMP. You know, I would say that from 25 to 26, the plan is roughly to double the brick-and-mortar construction capex. And

at this time, we would expect 27 capex to be up.

And, you know, but I want to emphasize that Micron is going to remain disciplined on CapEx growth to support, you know, bid demand or bid supply, and that supply will be in line with demand. As your question of capital intensity, our capital intensity, of course, is dropping as the market conditions remain very constructive, and, of course, we are working to be very efficient with our capital spend.

Analyst CJ Muse (Kansas Fitzgerald): Yeah. Good afternoon. Thank you for taking the question. I guess, Mark, to follow up on the prior question around CapEx, and, you know, the relative growth seems, you know, very conservative in the backdrop that we're in, and, you know, it feels like that you're just sitting here without clean room space. And it also doesn't sound like you're meaningfully pulling in clean room. So can you talk about the philosophy there? And I guess what I'm taking away from your commentary is that you're being very conservative and judicious with adding capacity here.

Management Mark (Title): Well, I would say that we've been indicating issues with supply for several quarters that we were working inventories down, that node transitions were going to be the principal source of supply growth in fiscal 26. And that's exactly what's happening. And we know that clean room space takes time and the HBM growth, which is only picked up with AI-driven demand, has further pressured supply. So there's no near-term solution. As we said in the prepared remarks, the entire industry we expect to be short to demand. And we're no different in that case. But we are moving quickly to do our best to provide customer supply. And we have pulled in tools. We have accelerated construction in Idaho. We are doing everything we can within our existing footprint and near-term capacity expansions to deliver supply. And so, you know, we provided a BIT gross number for 26, and that is supply constrained. And I'll just add that, of course, we are continuing to make investments in technology transitions in our existing footprint. And as we highlighted, that one gamma node will be, you know, majority driver of our supply growth in 26.

And, of course, you've seen us make investments not only in technology transitions, but also in greenfield capacity, but also enabling greater technology production capability in our existing clean rooms in Japan. And we are making the necessary investments there as well. So, of course, we remain disciplined, but we are very much focused and trying to work hard toward increasing our supply there. And pleased with our plans for Idaho 1, Idaho 2, and, of course, New York as well. And, of course, in the short term, very much focused on maximizing production efficiencies, maximizing our production output, from the existing footprint as well. But yes, I mean, demand fundamentals are pretty strong, you know, driven by AI from data center to edge with the build out of our customers and supply is significantly short. And, you know, I would say that, you know, in the medium term, we are only able to meet about 50% to two thirds of our demand from several key customers. So we remain extremely focused on trying to increase the supply here and making the necessary investments.

Analyst CJ Muse (Kansas Fitzgerald): Very helpful. And then I guess as a follow-up for gross margins, obviously the guide is quite stellar, but curious as you go through calendar 26, how should we think about cost down across both DRAM and NAND? And as you transition from 3E to 4, is there anything that we should keep in mind or we should think about and contemplate in our models? where there might be higher costs temporarily giving yields or whatnot. Thanks so much.

Management Mark (Title): Yes, so our CJR cost execution has been very good across both DRAM and NAND. Of course, we're getting some volume leverage, but spend control has been very good. Yields have been good. We do have some startup costs coming in for the new fabs, new construction across the network. It starts to come in second half of 26 and into 27. But at these, you know, size of the business at these levels, it's a relatively small impact on margin. You know, we're not going to provide cost guidance for the rest of the year as it depends on many factors, including mix. But to our earlier question, I can say that, you know, we talked about ramping one gamma DRAM and G9 NAND at length or supply in 26, and those ramps are proceeding well and will be a tailwind or a cost as these nodes ramp. And regarding your question on HPM3e and HPM4, as we have said, we'll be beginning to ramp production of HPM4 in CQ2 timeframe in line with our customer demands. And of course, our HPM4 is progressing extremely well, very pleased with our product, industry-leading product with the highest performance of over 11 gigabits per second.

And so, I mean, that's the highest performance, and we are very pleased with its overall yield ramp, and we expect our HBM-4 to be expecting having a faster yield ramp than our HBM-3E. And, of course, our mix of HBM-3E and HBM-4 during 26 will be very much based on our overall customer demands, and we will have both of these products with strong profile in our 26 revenue.

Analyst Holland Sir (JP Morgan): Good afternoon, and great job on the quarterly execution. You know, just over the past three to four months as we track the different ASIC AI XPU programs, there's been a significant upper revision on ASIC XPU volume shipments next year. You have Google TPU, AWS Trinium, and so on, right? And all of these XPUs are still going to be using HBM 3E. Have you, has the team seen this near-term positive dynamic in your order book for 3E? And given that you're fully contracted for calendar 26, and what appears to be growing upside to next year's view, how has the Micron team going to try and manage this upside dynamic in 3E alongside a strong HBM4 demand profile?

Executive Sanjay (Title): As I mentioned, Harlan, earlier, that, of course, 2026, we'll have a mix of HBM3E and HBM4. And we have shared with you in the past that, you know, we are engaged with multiple customers with the entire ecosystem here of HBM customers and very much engaged with them. And, you know, they will all contribute to our strong year-over-year growth in revenue in 26. And, of course, that will be made up of both HPM 3E and HPM 4. So, as I said, I mean, we will continue to manage the mix of the two based on, you know, customer requirements. I can tell you that, you know, in 2026, supply on HPM will be tight. A non-HBM DRAM will be tight as well. So we are continuing to see, as we have highlighted in our prepared remarks, you know, tightening supply environment. And, of course, we see strong year-over-year growth in 26 for our HBM. We today upped our, you know, revenue forecast for HBM. We highlighted that by 2028, we expect it to be $100 billion growth. That's two years ahead of our prior outlook. So, of course, HPM is on a good trajectory.

And what I can also tell you is that customers, as their architectures are evolving, as their platforms are evolving, and these are customers across the ecosystem, of course, they are requiring more and more HPM. I mean, the value of memory in terms of ability to deliver HPM the AI capabilities and the functionality and the performance, memory is critical and more HBM is required, and that's across the various AI platforms in the industry.

Analyst Holland Sir (JP Morgan): I appreciate that, Sande. And then after two to three quarters of enterprise SSD sort of muted trends, I believe the team saw a strong reacceleration in the business, right, according to some of the third-party research estimates. I think your enterprise SSD business grew like 25% sequentially in the most recent quarter, right? So you're the number three market share leader amongst eight or nine competitors, right? Very strong share position. Given, I would assume, increasing demand trends here, expanding lead times, Is the Micron team also entering into long-term supplier agreements with your ESSD customers? And then secondarily, I mean, SSD demand, is it more tied to expansion in inferencing workloads as customers aggressively move to monetization? In other words, is storage intensity higher on inferencing versus training workloads?

Executive Sanjay (Title): With respect to enterprise SSDs, really very proud of our engineering and business teams and of course our sales teams in terms of our customer engagement and the strong momentum and the share gains that we have with our enterprise SSD. Of course, our enterprise SSDs are a big part an important part, let me say, of our data center strengthening mix. You know, of course DRAM is continuing to increase in mix to our data center, but data center SSDs are an important part of our overall revenue mix. And, you know, we expect to continue to focus on share gains with our strong SSD roadmap, customer engagements, and great quality that we provide to the customers. And as I mentioned, that our multi-year contract that we are in discussions with our several key customers, our SSDs, our data center SSDs are also part of that. And let me tell you that these multi-year contracts are not just about data center customers. They also are about multiple customers across our market segments here.

And in terms of your questions on, you know, is the SSD requirement growing with inferencing versus training? What I can tell you is that in the data center AI applications, I mean, as the generative AI moves to more and more video, of course, that drives greater demand for more SSDs as well. So, I mean, you know, the rapid evolution of AI from training to inferencing and rapid evolution of AI models and applications, they're all driving greater growth of enterprise SSDs, yes, fueled by gen AI.

Analyst Tom O'Malley (Barclays): Hey, guys. Thanks for taking my question. Sanjay, you've been helpful in the past about kind of talking about Micron's ramp in HBM and then also the ramp of the total market. You gave some new color on HBM with the 35 billion moving at a 40% CAGR, but Micron specifically, I was curious, If you could give us any color on percentage of the DRAM business today, that's HBM from a dollars perspective. And then on share as you move into next year, obviously there's a large competitor that is looking to become more competitive at three. We haven't heard anything on four yet. How do you feel about your competitive positioning into next year? And do you think that you're going to make any strategic decisions differently based on the public, you know, certification of their memory in the next couple of months? Thank you very much.

Executive Sanjay (Title): We feel very good about our competitive position. We feel very, very good about our product and our HBM4 product that we have highlighted as industry-leading performance over 11 gigabits per second, the best specifications in the industry with our performance. And, of course, we feel very good about the power consumption in our products as well. You know, in the past, we have shared with you that our HBM3E is 30% lower power than any of the competitors in the industry, and we are maintaining that momentum of low power, which you know is, in data center applications, is very important. So we are maintaining our performance and power, and of course, our strong capacity position with HPM4 roadmap as well. So we feel very good about our competitive position, about our roadmap, and our roadmap going beyond HPM4 for the future years beyond 26 as well. And we are very proud of our team's ability to execute successfully over the course of last several quarters in terms of ramping up production capabilities of HBM 3E.

And we shared with you that in SQ3, we reached our share of HBM 3E to be in line with our, I mean, our HBM share to be in line with our DRAM share. And we have always highlighted that as we have reached that share, we will, particularly in this tight supply environment, we'll be managing the mix of our HPM as well as our non-HPM. All of it is in high demand. And, you know, HPM as well as non-HPM has strong profitability. So looking at our strategic customer relationships as well as our overall profitability goals and, you know, growth objectives. We'll continue to manage that mix between HBM and non-HBM. But, of course, HBM, you know, is growing, and we have highlighted that how we expect the TAM to be $100 billion by 2028, a couple of years ahead of our prior projection. And, of course, we will grow our HBM as well. 2026 will see a strong year-over-year growth in our HBM. And, you know, in this type of supply environment, as I mentioned, that the gap between the demand and supply for all of these, including HBM, is really highest that we have ever seen, and I quantified it earlier as well.

So in this environment, of course, working closely with our customers, we are continuing to manage our mix of the product here.

Analyst Tom O'Malley (Barclays): Perfect. And then just as a follow-up, you've said historically kind of the $8 billion run rate. If you look at November and February, you're taking up the total, Tim, but any color specifically on HBM contribution in the November quarter and what you're expecting in the guidance? You know, we are not really providing those specifics here in terms of the breakout. I mean, we highlighted that in SQ1, our HBM revenue was a record. We did highlight that. And beyond that, we are really not going to be providing the specifics in terms of revenue. And just to tell you again that year over year in 26, we will be seeing strong growth in our HBM revenue. And again, our product is very well positioned. So, I mean, that's a very good place to be in, in terms of managing overall mix of the business.

Analyst Chris Sankoff (TD Cowan): Hi, thanks for the question, and congrats on the phenomenal results and guidance. My first question is for Mark. I know you spoke about sustainability for next year. I'm kind of curious how to think about growth margins beyond the February quarter, like into May. Is it going to improve or sustain at this level? How do you think about the growth margins?

Management Mark (Title): Thanks, Krish. We're not guiding margins beyond Q2. We did guide a record Q2, as you know, 68%, 11 points sequential improvement, seven points better than the previous record. We did indicate that our business would strengthen through the year. And so we do believe margins can be up. We do believe that they will be up for DRAM and NAND. Now, keep in mind that at these high gross margin levels, you know, mathematically, you know, we get less in gross margin percent for the same increase in price. So, you know, we would expect gross margins to expand beyond fiscal Q2, but we would expect that growth to be more gradual than what we've seen in the last couple of quarters, or the first quarter and the second quarter guide.

Analyst Chris Sankoff (TD Cowan): Got it. Thanks a lot, Mark. That's super helpful. And Chris, just one last thing. You know, we have indicated that, you know, strengthen through the year because we believe this constructive market environment will remain so through the year, these favorable market conditions. But we also, you know, we're executing very well on cost. And as Sanjay mentioned earlier, we're deploying the bits to, you know, the valuable part of the market and where we can serve our customers best.

Analyst Chris Sankoff (TD Cowan): Got it. Super helpful, Mark. Thanks for that. And Sanjay, just as a follow-up to the earlier question, I understand you don't want to put some boundary conditions, but a year ago, you totally nailed it when you said you're going to get HBM market share close to your DRAM market share. So when you talk about 20, 28, 40 persons, 100 billion TAM, how do you think about Micron's HBM market share in that realm? Should you assume it's going to be the low 20%? So that spectrum or is it going to be lower? Thank you.

Executive Sanjay (Title): So, Krish, again, we are not really going to be specifying, you know, the share. As we have said, we will be managing the mix of the business between HBM as well as our non-HBM. It's like any other product in our portfolio that, you know, when you have a strong product roadmap across the portfolio, you know, then, of course, you know, we manage HBM. the mix across our portfolio with all the strategic reasons and customer relationships in mind. So, Krish, we are not really going to break that down. And, you know, all I would say is that, you know, in this current industry environment, which we see as durable industry fundamentals, you know, in the foreseeable future, we are in a very good position with all the tailwinds of our product portfolio. And, of course, increasing value of memory across the board, you know, of course, HPM, but also non-HPM in data center and other markets. We will just remain very focused on managing the mix of our business and, of course, managing for the best in the midterm as well as keeping in mind the longer term.

Analyst Chris Stanley (Citi): Hey, thanks, guys. So I just wanted to dig in on these long-term customer contracts you guys are negotiating. Can you give us any more sense of when you think you'll be able to sign these and then maybe just talk about what the holdup is? Is it just the unprecedented length or – and given that the AI companies are asking for so much of your capacity, are you able to get them to, you know, more or less contribute to the building of a new fab? Thanks.

Executive Sanjay (Title): So we will not really get into the specifics around our contract discussions with our customers. But, again, I will highlight a couple of important factors that, you know, customers are concerned about long-term access to adequate memory in the environment that we are heading into. And that's leading to constructive dialogues with several key customers and across our multiple markets in terms of their supply as well as other important specific commitments related to these longer-term contracts. So, not getting into the specifics, but as I highlighted, our contract structures that we are discussing are not like anything before. You know, they are far stronger contract structures with specific commitments. And, of course, different from prior contracts is that those used to be like one-year contracts, and these are multi-year in nature as well. And as we look at addressing the customer discussions, of course, we have to look at our overall supply. And I have mentioned to you that in the midterm, we are only able to meet, you know, half to two-thirds of the demand from our several key customers. So all of that, you know, as we are managing our customer relationships and, you know, keeping, you know, our strategic objectives in mind, all of that has to be taken into account as we manage our contract discussions.

Analyst Chris Stanley (Citi): That's still very helpful, Sanjay. Thanks. And for my follow-up, just a question on HPM and the pricing there. So, given that the demand is so strong, I think you said you're sold out for 26. Are you guys locked into a set price? or can you let that price more or less float a little bit given how strong demand is like DDR5 does, for example?

Executive Sanjay (Title): We are really pleased with our product position and our ability to work with our customers. As we highlighted in our prepared remarks, that our HBM for 2026 is sold out in terms of volume. And our negotiations with customers have been completed for calendar year 2026 for volume as well as pricing. And as we have always highlighted that our HPM has strong profitability, you know, and, you know, of course, you know, very much focused on ROI. And our non-HPM business also clearly has healthy profitability as reflected in the results that we produced as well as in the guidance that we have provided here.

Analyst Vivek Arya (Bank of America Securities): Thanks for doing my questions. Sanjay, I'm curious, at what point does increasing memory price impact, you know, demand for electronics if you set aside the data center and the AI market. Do you see some elasticity? Do you see any impact on demand as you look into 2026 for more consumer and kind of traditional enterprise products? How does that shape where memory pricing can go next year?

Executive Sanjay (Title): You know, we have highlighted in our prepared remarks that, you know, in some of the consumer markets, I mean, some of the unit demand may get impacted, given semiconductor prices here, given memory prices here. And of course, some of the customers may have, for example, in smartphone and PCs, they may have some mixed adjustments in their portfolio as well to address available supply to them. But these are accounted for in our forecast that we have. And so, I mean, some of the possible impact on unit demand and some of the customer mix changes have been accounted for in our forecast. And we, of course, even then, we see a very, very tight supply environment here in the large gap between the demand and supply. However, I will highlight to you that AI experience across from data center to edge including in these edge devices like smartphones and PCs and other devices, AI experience really more memory is essential. So without sufficient memory, you know, that AI experience, the functionality, the capability does get impacted in these edge devices as well. So, I mean, the punchline here is that AI across the board from data center to edge is driving increase in content and increasing requirement for memory as the customers look ahead at their roadmaps. And, you know, that's why customers are, of course, you know, working with us with respect to access to supply for their long-term multiyear plans here as well.

Analyst: This concludes our Q&A session. Thank you all for participating. You may now all disconnect.