GoKawiilPeople visit the Micron booth during the 7th China International Import Expo at the National Exhibition and Convention Center in Shanghai, Nov. 5, 2024.
As Micron customers try and adjust to a new reality of constantly rising memory prices, investors in the company are enjoying historic profit margins.
Alongside its better-than-expected earnings report on Wednesday, Micron disclosed a gross margin, or the profit left after accounting for the cost of goods sold, of 84.9%, up from 74.9% in the prior period and 39% a year earlier.
That's the highest percentage among all major U.S. tech companies, topping social media giant Meta , which recorded a gross margin in the latest quarter of 81.9%, and AI chipmaker Nvidia at 75%. It's a remarkable jump in pricing power for a company that's long been viewed as producing a commodity.
"Fiscal Q3 gross margin more than doubled from a year ago and was a new company record," CFO Mark Murphy said on the earnings call.
Fresh records are coming fast and furious for Micron, as data center companies gobble up all the memory they can find to meet artificial intelligence demand. Revenue of $41.46 billion in the fiscal third quarter was up more than $20 billion from the prior period, which had been the company's highest in its 48-year history. Net income of $28.24 billion is up over 100% from the previous high, also last quarter.
As of Wednesday's close, Micron's stock is up over 700% in the past year, pushing its market cap well past $1 trillion. It was up another 14% in extended trading.