Micron (MU) Q4 Earnings: Q1 Guidance Puts Fiscal 2027 Estimates Back in Play

Three days before Micron Technology reported fiscal fourth-quarter results, our earnings preview argued that Q4 itself was no longer the cleanest test of the story.

Wall Street had already moved Q4 consensus to $51.07 billion of revenue and $31.52 of non-GAAP EPS, close to the top of Micron's June guidance. The more consequential benchmark was fiscal Q1 2027, where consensus stood at $56.53 billion of revenue and $35.00 of EPS.

Micron reported $54.23 billion of Q4 revenue and $33.42 of non-GAAP EPS, then guided fiscal Q1 revenue to $61.5 billion, plus or minus $1.5 billion, and non-GAAP EPS to $38.15, plus or minus $1.00.

The Q1 midpoint is 8.8% above the pre-earnings revenue estimate and 9.0% above the EPS estimate.

The Q4 beat matters. But the larger analytical change is that fiscal 2027 now begins from a substantially higher first-quarter starting point, while management says revenue should grow sequentially in every quarter of the year.

Looking for the earnings-call recap? Read our [Q4 Earnings Insights](/news/earnings/mu-q4-fy2026-earnings) for management commentary, guidance, risks and transcript analysis.

Key figures

AlgovestIQ consensus is the frozen September 27 benchmark used in our pre-earnings preview. Consensus estimates can differ across data providers.

1. The surprise narrowed — consistent with the pre-earnings setup

Micron still beat Q4 estimates, but the size of the beat is part of the story.

Non-GAAP EPS came in about 6% above our frozen consensus. That is materially smaller than several recent surprises: the MU earnings history shows EPS beats of roughly 20.7%, 32.8% and 19.7% over the preceding three quarters.

That is consistent with a market in which analysts had already caught up to much of Micron's near-term earnings power.

The result was stronger relative to Micron's own June guidance. Revenue of $54.23 billion was $4.23 billion above the $50 billion midpoint and $3.23 billion above the top of the range.

So Q4 exceeded an already-elevated consensus, but the larger reset came from the next-quarter outlook.

2. Fiscal Q1 guidance moved the starting point almost 9% higher

Before earnings, Wall Street's fiscal Q1 2027 model called for $56.53 billion of revenue and $35.00 of non-GAAP EPS. Micron now guides to $60.0 billion–$63.0 billion of revenue and $37.15–$39.15 of non-GAAP EPS. The midpoints are $61.5 billion and $38.15.

Even the low end of each range exceeds the pre-report consensus.

Fiscal Q1 2027: pre-earnings consensus vs. guidance

That does not mean fiscal 2027 estimates mechanically rise by 9%. It means analysts now have to decide how much of the higher Q1 starting point carries through the rest of the year. The current estimates are tracked in the Event Read on MU's catalysts page.

3. The 14-week Q4 changes the sequential-growth picture

Fiscal 2026 was a 53-week year, with the extra week falling in Q4. Q3 had 13 weeks; Q4 had 14. That matters when comparing sequential revenue.

On reported quarterly revenue, Q4 increased about 31% sequentially and Q1 guidance implies another roughly 13% increase. On a weekly run-rate basis, Q3 to Q4 increased about 21.5%, and Q4 to the Q1 guide implies about 22%.

So the apparent deceleration in the headline quarterly growth rates is essentially a calendar effect. The weekly revenue pace implied by Q1 is growing at roughly the same rate as Q4.

The extra week does not explain Micron's Q4 beat: company guidance and analyst consensus were estimates for that same 14-week period. It simply gives a more comparable view of the forward revenue trajectory. The reported quarters are in MU's quarterly financial statements.

4. Management's own outlook puts a floor under the annual revenue debate

Before earnings, fiscal 2027 consensus stood at $253.15 billion of revenue and $158.42 of EPS. The analyst range was unusually wide: roughly $227.1 billion–$285.9 billion for revenue and $131.94–$221.23 for EPS.

Now add management's outlook. Micron expects sequential revenue growth in every quarter of fiscal 2027.

Starting from the $61.5 billion Q1 midpoint, simply holding revenue flat at that level for four quarters would produce $246 billion of annual revenue. Sequential growth in Q2, Q3 and Q4 would put revenue above that level.

That makes the old $227.1 billion low estimate difficult to reconcile with management's stated trajectory, if the new guidance and the sequential-growth outlook are achieved.

The old $253.15 billion consensus is different. Insert $61.5 billion for Q1 and the remaining three quarters need to average about $63.9 billion, only around 4% above Q1.

Expressed as a sequential growth rate, reaching the old $253.15 billion annual revenue consensus from $61.5 billion in Q1 requires revenue to increase by only about 1.9% per quarter through Q4. For EPS, reaching the old $158.42 annual consensus from $38.15 in Q1 requires about 2.5% sequential EPS growth per quarter.

Those are illustrative break-even growth rates, not forecasts. Operating expenses, taxes, share count and quarterly mix all matter. But they show why the old consensus does not require aggressive acceleration from the new Q1 starting point.

The more obvious tension is now at the bottom of the previous analyst range.

5. Gross margin stepped down — but the bridge matters

Our preview identified gross margin as one of the tests.

Micron reported 86.8% GAAP gross margin in Q4 and 87.0% on a non-GAAP basis. Fiscal Q1 guidance calls for approximately 85.95% GAAP and 86.25% non-GAAP. So the step down is real.

Micron also explained an unusual cost bridge. Manufacturing-related fiscal 2026 incentive compensation recorded in Q4 was absorbed into inventory. As that inventory is sold, the associated higher cost will move through cost of goods sold in Q1. The company also expects higher fiscal 2027 incentive compensation and additional start-up costs.

That means Q4 benefited from some manufacturing costs remaining in inventory rather than immediately flowing through the income statement, while Q1 absorbs part of those costs. Micron did not disclose enough detail to cleanly calculate an adjusted "underlying" Q1 margin, so we do not attempt to create one.

More important is management's forward statement that it expects fiscal Q1 to be the gross-margin floor for fiscal 2027, with margins improving after Q1 even as the rate of price increases moderates. That addresses the test raised in the preview; future quarters will determine whether it is realized.

6. Q4 remained heavily price-driven

Micron's Q4 memory results show why pricing remains central to the earnings model.

Micron said higher pricing was the primary driver of Q4 gross-margin improvement.

We do not convert the reported bit-shipment figures into weekly rates because Micron does not provide shipment timing within the quarter. But the extra week likely flattered reported Q4 bit growth as well, so the gap between price growth and underlying shipment growth may be even wider than the quarterly figures suggest. The conclusion does not depend on that adjustment: price increased substantially faster than bits.

Management nevertheless expects the supply environment to remain tight. Micron projects industry DRAM bit shipments to grow in the low-20s percentages in calendar 2027 and 2028 and NAND in the mid-20s, while expecting both markets to remain supply constrained. HBM bit shipments are expected to grow faster than conventional DRAM through 2028.

7. The contract thesis got materially larger — but the annual filing is not out yet

The June earnings call disclosed 16 signed Strategic Customer Agreements, or SCAs. Fourteen represented approximately $100 billion of cumulative revenue at minimum pricing over their remaining terms. Management's longer-term objective was to bring roughly half or more of company revenue under SCAs.

By September 30, Micron said it had signed 26 SCAs, and it currently estimates those signed agreements represent more than 35% of revenue through 2030.

Those two figures refer to different things: more than 35% is Micron's estimate for agreements already signed; 50% or more was management's longer-term objective.

Micron also disclosed approximately $150 billion of remaining performance obligations, or RPO. The company said RPO includes only SCAs with a determined pricing framework and is based on committed volumes at minimum pricing.

There is an important source distinction. Micron's fiscal 2026 10-K had not yet been filed as of October 1. The $150 billion figure therefore comes from Micron's September 30 prepared earnings remarks, not from the annual filing. The May 28 10-Q had reported only about $5 billion of RPO, because many of the later agreements had not yet been reflected. When the 10-K is filed, the contractual disclosure will be worth reconciling against the figure management provided with earnings.

Commitments are not the same as deposits already received

Micron said customer financial commitments associated with the 26 signed SCAs and extensions have increased to approximately $32 billion, with the vast majority expected in the form of cash deposits. That is not the same as cash already on Micron's balance sheet.

Micron received $12.3 billion of customer deposits during Q4 and ended the quarter with $12.7 billion of SCA customer cash deposits on the balance sheet. Those deposits are expected to be returned over time if minimum purchase requirements are met.

Micron also said more than 75% of its fiscal 2027 shipments are already committed.

8. HBM and data-center exposure remain central

All four reported business units grew sequentially.

Growth therefore broadened across Micron's reporting units. But that should not be confused with diversification away from data-center demand: Core Data Center and Cloud Memory together represented roughly 63% of total Q4 revenue.

HBM remains central to that exposure. Micron said Q4 HBM revenue grew faster than total company revenue, that it had completed agreements for the vast majority of its calendar 2027 HBM bit supply, and that HBM4 was continuing to ramp. Micron also disclosed work with Nvidia on a custom HBM4E implementation for future platforms.

The result strengthens the AI-memory demand thesis while preserving the concentration question highlighted before earnings.

9. Customer deposits do not inflate adjusted free cash flow

Micron generated $43.97 billion of operating cash flow in Q4 and $33.20 billion of adjusted free cash flow after $10.77 billion of net capital expenditures.

Because SCAs involve large customer deposits, the accounting treatment matters. Micron reports customer cash deposits associated with SCAs in financing activities, not operating activities, so they do not affect adjusted free cash flow. That removes an important potential distortion when interpreting the $33.2 billion figure, which was equivalent to roughly 61% of Q4 revenue.

10. The first stock move slightly exceeded the mechanical annual EPS change

Micron closed at $1,065.11 on September 30 and $1,097.39 on October 1, a 3.0% increase in the first full trading session after earnings.

That move should not be compared directly with the roughly 9% increase from the old Q1 EPS consensus to Micron's guidance midpoint. One is a stock-price move; the other applies to a single quarter.

Mechanically replacing the old $35.00 Q1 EPS estimate with Micron's $38.15 midpoint adds $3.15 to the old $158.42 fiscal 2027 EPS model. That is an increase of about 2.0% in annual EPS before making any changes to Q2 through Q4. Seen that way, the 3.0% stock move was slightly more than proportional to the immediate mechanical change in the annual EPS model.

What the market has not yet told us is whether investors and analysts will re-underwrite the rest of fiscal 2027.

At the October 1 close, Micron trades at about 6.9x the old $158.42 fiscal 2027 EPS consensus. If only Q1 were replaced with the new midpoint and every other quarterly assumption held unchanged, annual EPS would rise to roughly $161.57, putting the illustrative multiple around 6.8x. Neither figure is a new consensus estimate. Current valuation and trading data are on MU at a Glance.

The more consequential question is what happens to Q2 through Q4.

What changed from the preview?

Our September 27 preview identified four tests.

Q4 results. Micron beat consensus, but the approximately 6% EPS surprise was much narrower than several recent quarters. That is consistent with analysts having already absorbed much of the Q4 earnings reset.

Fiscal Q1 2027 guidance. This produced the largest change. The midpoint is almost 9% above our frozen pre-earnings revenue and EPS estimates, and even the low ends exceed them.

Gross margin. Q4 exceeded the prior guide, while Q1 steps down modestly. Micron attributes part of that decline to manufacturing incentive compensation moving through inventory and expects Q1 to be the gross-margin floor for the year.

Contracts, HBM and supply. Signed SCAs increased from 16 to 26, management disclosed approximately $150 billion of RPO, HBM continues to ramp, and Micron expects DRAM and NAND markets to remain supply constrained through calendar 2027 and 2028.

Micron has established a higher Q1 starting point. Now we can measure whether Wall Street simply adjusts that quarter or changes the shape of fiscal 2027 with it.

What we'll track next

We are keeping the September 27 estimates frozen as the pre-event benchmark rather than replacing them with post-earnings consensus. The next observations will tell us:

• ·how quickly fiscal Q1 revenue moves from $56.53B toward Micron's new range;
• ·how quickly fiscal Q1 EPS moves from $35.00;
• ·whether fiscal 2027 revenue moves materially above $253.15B;
• ·whether fiscal 2027 EPS moves above $158.42;
• ·whether the unusually wide analyst range narrows;
• ·and especially whether the low end of that range rises now that management has laid out sequential revenue growth throughout the year.

The first-quarter reset is already visible. The next question is whether Wall Street decides the rest of fiscal 2027 was too low as well. Upcoming reports are tracked on the earnings calendar.

Methodology

Pre-earnings estimates. These are the frozen AlgovestIQ observations used in our September 27, 2026 Micron Q4 preview: $51.07B fiscal Q4 revenue, $31.52 fiscal Q4 non-GAAP EPS, $56.53B fiscal Q1 2027 revenue, $35.00 fiscal Q1 EPS, $253.15B fiscal 2027 revenue and $158.42 fiscal 2027 EPS.

Reported results and guidance. Reported results and Q1 guidance come from Micron's September 30 earnings release, filed with its Form 8-K. Forward commentary on SCAs, RPO, customer deposits, HBM, pricing, bit shipments, the gross-margin floor and sequential fiscal 2027 revenue growth comes from Micron's September 30 prepared earnings remarks and call.

Filings. Micron's fiscal 2026 10-K had not been filed as of October 1. The prior Q3 10-Q reported approximately $5 billion of RPO as of May 28.

Quarter-length calculations. Fiscal Q3 and Q1 are normalized to 13 weeks and fiscal Q4 to 14 weeks. These are simple AlgovestIQ calculations intended to make sequential revenue comparisons comparable.

Illustrative annual calculations. These hold assumptions constant except where explicitly stated. They are not forecasts and do not reconstruct any individual analyst model. The October 1 closing price is preliminary.

This article is for informational purposes only and is not investment advice or a recommendation to buy or sell any security.