- Micron reported an 84.9% non-GAAP gross margin in fiscal Q3, above Nvidia’s 75% adjusted gross margin, as scarce memory gives suppliers greater pricing leverage.
- Nvidia expects adjusted gross margin to decline toward 71% to 72% in its January quarter because memory costs are rising, despite quarterly revenue reaching $96.2 billion.
- Micron has begun high-volume HBM4 production for Nvidia’s Vera Rubin platform, while management expects tight DRAM and NAND conditions beyond 2027.
- Micron trades at roughly six times fiscal FY27 consensus earnings, reflecting investor concern that the memory market will eventually revert to its historical boom-bust cycle.
Quotes
“The hottest margin in AI hardware no longer belongs to the company selling the GPUs. It belongs to the company selling the scarce memory those GPUs cannot run without.”
“The supplier controlling the scarcest component has the most room to raise prices.”